Updated October 2026 for the 2026–27 financial year.
What is Division 296 tax?
Division 296 is a new tax on super earnings for people with large balances, starting on 1 July 2026. Earnings on the part of your balance between $3 million and $10 million are taxed an extra 15%, so about 30% in total. Earnings on the part above $10 million are taxed an extra 10% on top of that, so about 40% in total.
It's based on realised earnings, which means investment income and gains on assets that are sold. Changes in the value of assets you still hold aren't taxed.
How the tax is calculated
The ATO works out what share of your balance is over each threshold and applies that share to your earnings:
- Over $3 million: (balance − $3m) ÷ balance × earnings × 15%
- Over $10 million: (balance − $10m) ÷ balance × earnings × 10%
For example, with a balance of $4.5 million and $250,000 of earnings, one-third of your balance is over $3 million. So one-third of your earnings, $83,333, is taxed an extra 15%, a bill of $12,500.
Which balance is used?
For the first year, 2026–27, the ATO uses your total super balance at 30 June 2027. From 2027–28 it uses the higher of your balance at the start or end of the year. Both thresholds are indexed in fixed steps.
Paying the tax
The ATO sends you an assessment after your fund reports your earnings. Like Division 293, you'll be able to pay it yourself or have it released from your super.
SMSF trustees could choose to reset the cost base of fund assets to their 30 June 2026 value for Division 296 purposes. This choice is irrevocable and must be made by the fund's 2026–27 tax return due date. Speak to your SMSF accountant or adviser.
Frequently asked questions
When does the $3 million super tax start?
Division 296 tax starts on 1 July 2026, so the first year it applies to is 2026–27.
Does Division 296 tax unrealised gains?
No. The final law taxes realised earnings only. Increases in the value of assets you still hold aren't included.
What are the Division 296 tax rates?
An extra 15% on earnings attributable to the part of your balance between $3 million and $10 million, and an extra 10% on top of that for the part over $10 million. That's about 30% and 40% in total including fund tax.
Are the $3 million and $10 million thresholds indexed?
Yes. Both thresholds will be indexed in fixed increments, similar to the transfer balance cap.
Which balance does the ATO use for 2026–27?
Your total super balance at 30 June 2027. From 2027–28, it's the higher of your balance at 1 July and 30 June.
About this calculator
This calculator gives general information only. It doesn't consider your personal circumstances and isn't financial or tax advice. It assumes you're an Australian tax resident and uses 2026–27 rates published by the ATO. Check your figures in myGov and speak to a registered tax agent or licensed financial adviser before acting. Your inputs stay in your browser and are never sent anywhere.