From 1 July 2025, the general transfer balance cap (TBC) will increase from $1.9 million to $2 million. This follows the release of the December 2024 quarterly Consumer Price Index (CPI) data.
What is the transfer balance cap?
The transfer balance cap (TBC) is a limit on the total amount of superannuation that members can transfer into their tax-free retirement phase.
Who will be affected by the increase?
- Members who have satisfied a full condition of release but are yet to start a retirement phase income stream
- Members approaching retirement or age 65 who will be eligible to start a retirement phase income stream
- Members who have started a retirement income stream without using their full TBC
What this means for members
The ATO is expected to confirm the increase, effective from 1 July 2025, following the release of the December 2024 quarterly Consumer Price Index (CPI) data.
The All-Groups CPI data released by the Australian Bureau of Statistics on 29 January 2025 showed a 2.4% rise from December 2023. The general TBC is indexed in $100,000 increments and the CPI rise was sufficient to trigger the increase, to apply for the 2025–26 year.
This means that members can start their first retirement phase income stream in the 2025–26 year with a TBC of up to $2 million.
Members starting retirement phase income streams prior to 1 July 2025 without utilising the full caps at the time will be entitled to a proportional increase in their TBC.
The TBC increase will also apply to the total superannuation balance (TSB), measured on 30 June 2025. This will affect what non-concessional contributions can be made in the 2025-26 year. Although the contribution caps remain unchanged (they are linked to average weekly ordinary time earnings), the non-concessional bring forward thresholds will alter in line with the increase, as follows:
Bring-forward cap first year (applying to 2024–25 year)
| TSB on 30 June 2024 | Non-concessional contributions cap for the first year | Bring-forward period |
| Less than $1.66 million | $360,000 | 3 years |
| $1.66 million to less than $1.78 million | $240,000 | 2 years |
| $1.78 million to less than $1.9 million | $120,000 | No bring-forward period, general non-concessional contributions cap applies |
| $1.9 million or more | nil | Not applicable |
Bring-forward cap first year (applying to 2025–26 year)
| TSB on 30 June 2025 | Non-concessional contributions cap for the first year | Bring-forward period |
| Less than $1.76 million | $360,000 | 3 years |
| $1.76 million to less than $1.88 million | $240,000 | 2 years |
| $1.88 million to less than $2 million | $120,000 | No bring-forward period, general non-concessional contributions cap applies |
| $2 million or more | nil | Not applicable |
Members with larger balances who are able to take advantage of the cap increase will need to determine whether they delay the income stream start date until after 30 June 2025. To plan for the increase, it is important for them to review their balances in the coming months and seek assistance from their advisors.
Contact Pilot
If you have any questions regarding these matters, contact Angela Stavropoulos, Kristy Baxter or Simon Barry on (07) 3023 1300.