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2018 High Income Threshold and Superannuation Contributions Base
Date : 02 July 2018
Author/s : Martin O'Connor, Brandon Chakty
Type : Focus Paper


From 1 July 2018, the high income threshold and maximum superannuation contributions base have increased.

High Income Threshold

On 1 July 2018, the high income threshold increased from $142,000 to $145,400.

The high income threshold is important for the following reasons:



Employees who are not covered by a modern award or subject to an enterprise agreement and who receive annual earnings above the high income threshold are unable to make an unfair dismissal claim.


The maximum amount of compensation payable for a successful unfair dismissal claim is capped at the lower of:


i. half the amount of remuneration received by the dismissed employee in the 26 weeks immediately before the dismissal; or


ii. half the amount of the high income threshold, which is $72,700 after 1 July 2018.

In determining whether an employee earns more than the high income threshold, what is included is the employee's wage and other amounts applied or dealt with as salary sacrifice amounts and the value of non-monetary benefits received by the employee.  What is not included are payments which are not set in advance such as commissions, bonuses and overtime and compulsory superannuation contributions.



Superannuation Contributions Base

On 1 July 2018, the maximum superannuation contributions base increased to $54,030 per quarter. An employer is required to contribute 9.5% of an employee's ordinary time earnings to a superannuation fund nominated by the employee but only up to the maximum superannuation contributions base.


If you require more information about employment law matters, contact Addisons' employment law team.

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