What Business Owners Need to Know About the New $3M Super Tax - Sovereign Private

Following the Federal election, the Government is expected to reintroduce the Division 296 (Div 296) tax, applying an additional 15% tax on earnings for individuals with superannuation balances exceeding $3 million. Set to commence from 1 July 2025, the tax targets unrealised gains above this threshold. Affected individuals can pay the tax personally or from their super. No indexation of the $3 million cap is proposed. While some may benefit from retaining funds in super, others might consider partial withdrawals. Given the complexity and potential implications, personalised tax advice is essential. The first test date is expected to be 30 June 2026.