New Legislation May Let You Transfer Super to Your Spouse
Did you know you may soon be able to split superannuation balances with your spouse to help even out your retirement savings? A proposed change in legislation could offer couples a powerful new way to create greater financial equality—especially for partners with lower super balances.
Tackling the Gender Super Gap
Thanks to the recently introduced Tackling the Gender Super Gap Bill, a new measure could allow the partner with the higher super balance to roll over an amount to the other partner’s super fund—during the accumulation phase.
The goal? To create fairness between couples by addressing long-standing gender-based disparities in super, often due to women taking time out of the workforce for caregiving roles—a phenomenon commonly referred to as the “mother penalty.”
The Bill also recognises that contributions to a household go beyond paid employment, and aims to ensure superannuation acknowledges this.
Couldn’t You Do This Before?
Yes—but only in a limited way.
Currently, there are a couple of slower methods to even up super balances:
- Contribution splitting: You can split concessional contributions (such as employer super contributions) with your spouse on an annual basis.
- Spouse contributions: You can make after-tax contributions directly into your spouse’s super account.
Additionally, super splitting has long existed in divorce settlements, where one partner’s super can be transferred to the other. So, as Senator Jane Hume (who introduced the Bill) argued—if you can do it after a relationship ends, why not allow it while the relationship is ongoing?
A New Option—Not a Requirement
This new mechanism is optional, not mandatory. It gives spouses the flexibility to rebalance their super, but doesn’t force anyone to act.
However, some important rules and limitations apply.
Key Conditions and Limits
Here are the key eligibility rules and safeguards once the mechanism becomes law:
- Office equipment and computers
- Spouses must both be in the accumulation phase (not retirement/pension phase).
- Both must have only one superannuation account.
- The mechanism is not available for defined benefit scheme members.
- How the Transfer Works:
- The amount rolled over retains the concessional/non-concessional, and taxed/untaxed status of the original fund.
- It is treated as a rollover, not a contribution—so it won’t trigger contribution caps or extra tax.
- How the Transfer Works:
- The rollover cannot leave the donor fund with a lower balance than the receiving fund.
- The transfer must not push the receiving fund over the general transfer balance cap (currently $2 million).
- A “spousal redistribution limit” will apply to cap the amount that can be transferred.
Why This Matters
If passed, this reform gives couples more control over their shared retirement future. It’s a practical way to address inequality in super balances caused by time spent out of the workforce, and to recognise shared contributions within a relationship.