I have been a member of the federal government's PSS Defined Benefit Super Fund since 2001, and with a super balance of $441K as at June 30 2021.
Because the PSS is a Defined Benefit fund I am aware I am unable to make extra contributions into it to aid my retirement, so on the 29th of January this year (ie during the 2020-2021 financial year) I opened a second super account, a PSSap account running alongside the PSS account so I could start contributing extra to super.
Shortly after opening the PSSap account I learned about the Carry-forward unused concessional contributions provision for the first time, and using MyGov linked to the ATO, I saw I had a total of $42000 worth of unused concessional contributions 'accrued' from the 2018-2019, 2010-2020 and 2020-2021 financial years. Realizing it would be a good way to increase my super, on the 16th of June 2021 I made an after tax payment of this amount to the PSSap with the intent of claiming a tax deduction for this amount from my 2020-2021 tax return, (effectively converting this non concessional contribution into a concessional contribution).
Last week I submitted a Notice of Intent form to the PSSap advising that I would like to claim the $42000 as a deduction and I am presently waiting for the acknowledgment before I complete and submit my 2020-2021 tax return.
Keep in mind that prior to making this $42000 contribution to the PSSap my total super balance (PSS and PSSAP combined balance) was below $500K which I believe is the maximum amount someone can have in their super fund(s) wanting to take advantage of the the Carry-forward unused concessional contributions rule? When is the $500K maximum cap of 500K calculated? Is it at the time the contribution is made or is it on June 30 of the financial year in which it is made?
And this is where I think I may have made a mistake. After listening to a Sydney talkback radio program where a financial advisor was discussing superannuation and the benefits of making a non concessional contribution prior to the end of the financial year (ie June 30) I made a second after tax (ie non concessional) member voluntary contribution of $88000 to the PSSap on June 18 2021. I do not intend to claim a deduction for this contribution, it will remain a non concessional contribution.
I didn't think any more of it up until a few days ago when I was filling out a Notice of Intent form to advise the PSSap that I wish to claim the $42000 as a deduction (I am presently waiting for the acknowledgment before I complete and submit my tax return) that I realised that by making this second payment of $88000 (which is a non concessional contribution) I may have unwittingly put my total super balance over the $500K limit - ie above the $500K cap.
Have I exceeded the cap? And if I have how do I rectify this error with the ATO to avoid 'paying all this extra tax' I keep hearing about?
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