Does superannuation get taxed?
Yes, super is taxable. Your super money is taxed when it’s paid into your account, on investment earnings while it’s in your account, and (depending on your age and circumstances) when you eventually take it out of your account.
But one of the best things about super is that you’ll almost certainly get hit for less tax than you would by having your savings in a bank account or invested directly in managed funds.
If you’ve got money in a bank savings account, you pay tax on the interest it earns at whatever your ‘marginal tax rate’ is. For example, if you earn $60,000 a year, your marginal tax rate is 34% (including the Medicare levy) for the 2013-14 financial year. Inside super, you would pay tax at a maximum of 15% on interest or investment returns.
If you’re self employed, you can usually claim a tax deduction for personal super contributions you’ve made.
Super becomes even more tax effective after you’ve reached the age when you can get access to your super benefits.