Salary Sacrifice and Super Contribution Strategies for Executives
Written by Kurt Armbruster, Financial Adviser | Last reviewed: 20th September 2026
C-suite leaders and business directors can optimise their tax position and accelerate wealth accumulation by implementing advanced contribution strategies. Beyond mandatory employer contributions, utilising salary sacrifice arrangements allows high earners to direct pre-tax income into the concessional superannuation environment, reducing their taxable income.
Furthermore, the “carry-forward” rules allow individuals with super balances below $500,000 to utilise unused concessional caps from the previous five years, providing a powerful tool to offset large tax events like bonus payouts. Managing both concessional and non-concessional caps is vital to ensure that contributions remain within legal limits whilst maximising the long-term compounding benefits of the tax-effective superannuation environment. A systematic approach to these contributions can significantly enhance retirement capital.
How does salary sacrifice reduce tax for high earners?
For high-earning executives subject to top marginal tax brackets, tax efficiency is a primary driver of overall portfolio growth. Salary sacrifice enables individuals to redirect earnings prior to personal income tax assessment, subjecting those funds instead to the flat 15% concessional contributions tax within the superannuation environment.
Salary sacrifice, employer Superannuation Guarantee contributions and personal deductible contributions all count towards the concessional contributions cap, which is $32,500 for 2026-27. For executives on large salaries, employer contributions alone can use most of the cap, so the room left for salary sacrifice needs to be calculated each year.
What is Division 293 tax?
Even when accounting for Division 293 tax, which imposes an additional 15% levy on concessional contributions for individuals with income exceeding specific thresholds (currently $250,000), the combined tax rate of 30% remains significantly lower than the top personal tax bracket, creating a clear net benefit.
Want to know how much room you have under your cap this year? Talk to our superannuation advisers before your next bonus is paid.
Using carry-forward concessional contributions
Where your total super balance was below $500,000 at the previous 30 June, unused concessional cap amounts from up to five previous financial years can be added to this year’s cap. This is especially useful in a year with a large bonus, a share vesting event or a capital gain. Our guide to carry-forward concessional contributions explains how the rolling five-year window works.
Non-concessional contributions and the bring-forward rule
Beyond pre-tax strategies, executives can systematically inject post-tax capital using non-concessional contributions. By employing the “bring-forward” rule, eligible individuals can aggregate up to three years of non-concessional contribution allowances into a single financial year (up to $390,000 in 2026-27), enabling rapid capital injections following equity vesting, asset sales, or inheritance events.
Care must be taken to monitor total superannuation balance thresholds, as exceeding statutory limits closes access to non-concessional mechanisms and can result in excess contribution penalties. High balances also bring Division 296 tax into consideration once your total super balance approaches $3 million.
Coordinating remuneration with your super strategy
A comprehensive executive wealth strategy coordinates corporate remuneration structures with long-term superannuation goals. Aligning performance bonuses, share options, and salary sacrifice schedules ensures that contribution caps are fully utilised without inadvertent breaches. Through continuous monitoring and tailored financial planning, executives can protect their income, optimise annual tax liabilities, and build a substantial capital base for post-corporate life.
Salary sacrifice FAQs
For most people on the top marginal rate, yes. Salary sacrificed amounts are taxed at 15% in the fund instead of your marginal rate of up to 47% including the Medicare levy. If your income is above the Division 293 threshold, the contributions tax rises to 30%, which is still well below the top personal rate. The trade-off is that the money is preserved in super until you meet a condition of release.
Division 293 tax applies when your income plus low-tax super contributions exceeds $250,000. The ATO calculates it after you lodge your tax return and charges an extra 15% on the concessional contributions above the threshold. You can pay the assessment personally or have it released from your super fund.
Yes. Employer Superannuation Guarantee contributions, salary sacrifice and personal contributions you claim as a tax deduction all count towards the same concessional cap, which is $32,500 for 2026-27. Executives on high salaries should check how much of the cap their employer contributions already use before setting up salary sacrifice
Excess concessional contributions are included in your assessable income and taxed at your marginal rate, less a 15% offset for the tax already paid by the fund. You can elect to release up to 85% of the excess from your fund to help pay the tax. Careful planning around bonuses and vesting dates avoids this.
In 2026-27, eligible people under age 75 can contribute up to $390,000 in non-concessional contributions in one year by bringing forward three years of the $130,000 annual cap. The amount available depends on your total super balance at the previous 30 June, and it reduces to nil once your balance reaches $2.1 million.
Get your contribution strategy right before 30 June. Our superannuation advice service coordinates salary sacrifice, bonuses and caps into one plan. Book a chat or call 0449 890 302.
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This content is general advice only and does not take into account your personal objectives, financial situation, or needs. Before acting on this information, consider its appropriateness to your circumstances and seek professional financial advice. Authorised Representative of Templestone Financial Services Pty Ltd AFSL No. 523831. Trustee for the Armbruster Family Trust T/A Super Financial Advice.