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Superannuation is one of the most important parts of retirement planning in Australia. Yet for many low and middle-income earners, contributing extra to super can feel like a luxury they simply can’t afford. To support those workers, the Australian Government has long offered a helpful incentive known as the Super Co-Contribution scheme.
For 2025, this scheme is once again available offering up to $500 in tax-free contributions for eligible individuals who make voluntary contributions to their super. If you’re a low-income worker or someone earning under a certain threshold, this could be an easy way to boost your retirement savings without paying a cent in extra tax.
In this article, we’ll explain exactly how the $500 Super Co-Contribution works in 2025, who can receive it, how to qualify, and why it’s worth taking advantage of.
What is the Super Co-Contribution?
The Super Co-Contribution is a government initiative designed to encourage low and middle-income earners to add more to their superannuation. When you make a personal (after-tax) contribution to your super, the government may match it with a contribution of up to $500, depending on your income level and how much you contribute.
The co-contribution is not a loan or a deduction. It is a tax-free bonus that the government pays directly into your super fund, increasing your retirement savings without affecting your taxable income.
This scheme has been around for years, but it continues to be one of the most underused incentives – often because people are unaware of how easy it is to qualify.
Who is Eligible in 2025?
Not everyone is eligible to receive the co-contribution. To qualify in the 2024–25 financial year, you need to meet the following criteria:
- Your total income is less than $43,445 to receive the full $500 bonus (this threshold increases slightly each year)
- You must earn less than $58,445 to receive a partial co-contribution
- You made a personal after-tax contribution to your super during the financial year
- You are under 71 years old at the end of the financial year
- You did not hold a temporary visa (unless you’re a New Zealand citizen or a permanent resident)
- You lodged a tax return for the year
- At least 10% of your income came from employment or self-employment
If you meet all these conditions, the government will calculate your entitlement based on how much you contributed and how much you earned.
How Much Will You Get?
The maximum co-contribution is $500. To receive the full amount, your total income must be at or below the lower threshold (which is $43,445 for the 2024–25 financial year). You also need to contribute at least $1,000 of your own after-tax money into your super fund.
If your income is between the lower and upper threshold ($43,445 to $58,445), you may receive a reduced co-contribution. The amount reduces by 3.333 cents for every dollar you earn above the lower threshold.
For example
- If your income is $45,000 and you contribute $1,000, your co-contribution will be slightly less than $500
- If your income is $50,000 and you contribute $1,000, your co-contribution might be around $300
- If your income is $58,000 or more, you won’t be eligible at all
The co-contribution is always capped at the amount you contribute. So, if you only contribute $500, the maximum co-contribution you can receive is $500, even if your income is below the threshold.
Why It’s Tax-Free and Beneficial
One of the biggest advantages of the Super Co-Contribution is that it is completely tax-free. That means you won’t be taxed on it when it is paid into your super fund, and it won’t count as part of your taxable income.
Additionally, it is not considered part of your concessional contributions cap, so it won’t interfere with any employer super or salary sacrifice arrangements.
In short, this is free money from the government that helps you grow your retirement savings with no strings attached.
How to Get the Co-Contribution
You don’t need to apply for the co-contribution separately. Here’s how it works.
- During the financial year, you make a personal after-tax contribution to your super fund.
- You lodge your tax return for that financial year.
- The Australian Taxation Office (ATO) automatically calculates your eligibility and contribution amount.
- If you are eligible, the ATO pays the co-contribution directly into your super fund, usually within a few months after your tax return is processed.
Make sure your super fund has your tax file number (TFN), as the co-contribution cannot be paid if the fund doesn’t have it.
How to Make a Personal Contribution
If you haven’t made a personal contribution before, the process is simple:
- Contact your super fund or log in to their online portal
- Look for an option like “Make a personal contribution” or “After-tax contribution”
- Transfer the amount you want to contribute (up to $1,000 to receive the full co-contribution)
- Keep a record of your payment for your tax records
You don’t need to notify the ATO at the time of contribution. The process is automatic as long as you lodge your tax return and your income is within the required range.
Why You Should Consider It
If you’re a low or middle-income worker, this is one of the easiest ways to increase your retirement savings without extra cost. The government is essentially giving you up to $500 for contributing $1,000 of your own money to super.
Even if you can’t afford to contribute the full $1,000, any amount can still result in a partial co-contribution. For example, if you contribute $300 and your income is low enough, the government might add another $150 to your super.
Over time, even small contributions can grow significantly thanks to compound interest, making this scheme a smart long-term investment in your financial future.
Final Thoughts
The $500 Super Co-Contribution for 2025 is a valuable opportunity for low and middle-income Australians to boost their retirement savings with help from the government. It’s easy to access, tax-free, and automatic all you need to do is make a personal contribution and lodge your tax return.
If your income is under the eligibility threshold, take advantage of this scheme. Even a small contribution can go a long way in improving your retirement outlook. It’s free money and who doesn’t want that?