If you work for yourself, you may be wondering if you have to pay super or not. And if so, how much you should pay. Learn more about making super contributions as a sole trader or self-employed person.

Do self-employed people have to pay super?

The short answer is – it depends on how your business is set up.

If you're self-employed as a sole trader or in a partnership, it's your choice whether you'd like to make payments to your super.

If you're contracted as a sole trader from a business under a pay as you go (PAYG) scheme or you pay yourself a salary as an employee of your business, then you may be required to pay yourself super by law.

You can work out if you have to pay super or not by using this guide from the Australian Taxation Office (ATO).

Paying yourself super as a self-employed person

Just because you don't have to make compulsory super contributions as a sole trader, doesn't mean you can't set yourself up for life after work.

You can choose to make personal super contributions to your super fund directly from your bank account as often as you'd like. And you may even be able to claim a tax deduction.

Use our Superannuation Contributions Calculator to see the difference making payments to your super fund now could have on your retirement.

Superannuation Contributions Calculator

Some of the benefits of paying yourself super as a sole trader:

• While it might seem like ages away, paying yourself super now can make a big difference to your financial future when you retire.
• If you make after-tax contributions, depending on how much you earn, you may benefit from claiming a tax deduction.
• Investment returns through your super fund are generally better than bank savings accounts and term deposits, so your money will grow over time.
• You might have access to insurance cover (such as death, total & permanent disability, and income protection cover) through your super fund, to protect you and your loved ones if life doesn't go to plan.
• If you're a low income earner, you may be able to get a bonus from the government.

Things to consider before making a self-employed super contribution:

• Although you're setting up your future self by paying super now, you generally won't be able to access the money until you reach the age you can access your super and retire.
• You need to provide your super fund with your tax file number (TFN) before you can make a personal super contribution.
• There's a limit to how much money you can pay into your super after-tax each year (called the non-concessional contributions cap). It's currently set at $110,000 for 2023–24.
• If your total super balance is $1.9 million or more at 30 June 2023, you can't make after-tax super contributions in the financial year.

Choosing a super fund

Most people, including sole traders, can choose which super fund they'd like to join. Your superannuation is designed to grow with you for your future, so it's important to choose a super fund that helps you achieve your goals.

There are many reasons to join ART, including:

• Strong long-term investment returns²

• Award-winning products and services

• Focused on lower fees.

See how we compare