Reading time: TWUSUPER for sole traders
As a sole trader, your superannuation really is in your hands. Unlike companies, there are no compulsory super obligations you need to meet. But, if you’re looking forward to a comfortable retirement, you’ll still need good super. Fortunately, paying your own super as a sole trader is easy with TWUSUPER, and it comes with valuable tax benefits.
What’s more, you can make contributions at any time.
How much should I contribute if I am self-employed?
That’s up to you. Many sole traders and small business put some of their earnings into super each year. If you’re having a good year and the outlook is rosy, you can put more in. If times are tough, you may want to put in less – it’s your call.
From 1 July 2024 you can contribute up to $30,000 per financial year in total to your super to benefit from a lower rate of tax. Contributions above that (from any source) will be taxed at the marginal income tax rate (unless you can use the ‘carry forward’ rule – see our Product Disclosure Statement).
How do I contribute as a sole trader?
It’s easy to pay super into your TWUSUPER account and claim a tax deduction as a sole trader. Just transfer funds to your TWUSUPER account, complete our pre-filled ATO notification form, send it in and we’ll do the rest. You can make small payments over time, or a single payment before the end of the financial year.
Super for incorporated (Pty Ltd) companies and trusts
If you’re self-employed but your business is registered as a Pty Ltd company with ASIC, then technically you’re an employee of your own business. That means that the company must pay your super under the super guarantee rules. For the financial year starting 1 July 2024, the minimum SG rate is 11.5% of your ordinary time earnings. The SG rate will rise to 12% on 1 July 2025. However, since you’re in charge of your business and your retirement, you can always decide to pay more if you want.
After all, the more you invest now in your super, the more there'll be waiting for you when you retire.
Join or find out more
If you’re self-employed, join TWUSUPER today and prepare for a better life in retirement.
Or, to discuss your business structure (or anything else super-related), call us on 1800 222 071 between 8am and 8pm (AEST/AEDT) Monday to Friday.