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Transfer balance cap

What is the transfer balance cap (TBC)

Section: 9.1

9.1 What is the transfer balance cap (TBC)

The general transfer balance cap limits the amount a member can move into a retirement phase pension. Any amounts exceeding the cap will need to be moved out of retirement phase and may potentially trigger a penalty.

Transfer balance cap

The transfer balance cap commenced on 1 July 2017. The cap is indexed at the Consumer Price Index (CPI) each year and rounded down to the nearest $100,000.

Year Transfer balance cap
1 July 2017 - 30 June 2021 $1.6 million
1 July 2021 - 30 June 2023 $1.7 million
1 July 2023 onward $1.9 million

A member's personal transfer balance cap (PTBC) differs depending on their personal circumstances including the year in which they first had a transfer balance cap.

The indexation of the general transfer balance cap may impact other caps and limits:

  • ability to make non-concessional contributions
  • ability to use the bring-forward provisions for non-concessional contributions
  • eligibility for the co-contribution
  • eligibility for the tax offset for spouse contributions
  • the defined benefit income cap

Source: ATO

This technical resource is intended for the use of financial advisers only. It is current as of the date of publication but may be subject to change. This publication has been prepared without taking into account a potential investor's objectives, financial situation, needs or objectives. Before making a recommendation based on this material, you should consider its appropriateness based on the client's objectives, financial situation and needs. Rainmaker Group is not a registered tax agent under the Tax Agent Services Act 2009. Your client should refer to a registered tax agent before relying on information published herein that may impact their tax obligations, liabilities or entitlements.

Last modified: Monday, June 19, 2023