Can I make super contributions while working overseas?

Heading to another country to work can be exciting, but it does raise questions about what happens to your superannuation. One thing you might want to consider is making some contribution to your super while overseas.

No matter what age or stage of your career you’re at, it’s hard to pass up an opportunity to live and work in another country.

Border closures during the pandemic may have put a temporary stop to some international travel, but Australians are once again heading overseas. Around one million Australians are said to be living and working overseas at any given time, according to the Australian Government’s Smartraveller website.

But before you book a ticket, it’s worth understanding what happens to your super while you’re working overseas. If you miss out on any potential contributions when you’re working outside Australia it could have a significant impact on the value of your super when you’re ready to retire.

What happens to my super if I work overseas?

Whether you decide to head overseas permanently or temporarily, the rules around super don’t change.

If you’re an Australian citizen or permanent resident, you won’t normally be able to access your super until you reach preservation age. For most of us, that’s between the ages of 55 and 60, depending on when we were born.

The issue then is what to do with your super while you’re working overseas.

Will my employer keep making super contributions if I work overseas?

The question of whether your employer will continue to make super contributions on your behalf while you’re working overseas depends on who you work for.

If you work for an Australian employer and are temporarily employed overseas, then any super guarantee contributions are likely to be paid into your Australian super fund while you’re away. That’s because Australia has bilateral social security agreements with a number of countries.

The idea behind these agreements is that your employer won’t double up on super contributions. Put simply, Australian employers must continue to pay super contributions for you here in Australia – but not in the country you’re working in overseas.

Your employer needs to apply for a certificate of coverage to be exempt from paying super to you overseas. This is likely to be organised by your human resources department, but it’s something worth checking with your employer before you leave Australia.

If your employer is paying superannuation guarantee contributions to your self-managed super fund (SMSF), the Australian Taxation Office (ATO) says you should check your SMSF management arrangements before you leave Australia.

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What happens to my super if I’m not working for an Australian employer?

Things get a little more complex if you are working overseas for an employer that isn’t an Australian-based organisation.

Different countries each have their own systems of saving for retirement, and while you may be entitled to employer-paid super (depending on where you choose to live and work), a non-Australian employer is not obliged to pay contributions into your Australian super fund.

If you do accumulate super (or its equivalent) in an overseas fund, you may be able to transfer the money to your Aussie-based super fund, but strict rules apply.

For example, from the 2022–23 financial year onwards, an Australian super fund can accept member contributions for you as long as you are aged under 75. Once you turn 75, the fund can’t accept member contributions.

The ATO spells out the specific rules for transferring super accumulated in an overseas fund, so it’s important to speak to your Australian super fund for advice on how to complete a transfer. You may also be interested to check out a few tips for transferring a UK pension to your Australian super fund.

Can I make super contributions while working overseas?

Yes! In fact, making super contributions of your own while you’re working overseas can be a good idea – and not just because it helps to grow your super savings.

As we noted earlier, if you work for a non-Australian employer while overseas, chances are there’ll be no employer-paid contributions heading into your super account.

This could see your super declared as ‘lost’ if your fund has lost contact with you and your account hasn’t received a contribution or rollover for 12 months, or if there has been no activity in your account for five years.

An easy way to avoid this situation is to set up a regular direct debit into your super. Even a couple of dollars added to your super each week or month will keep your account chugging along without the risk of it being considered ‘lost super’.

It’s a reminder too, that along with all the other plans you need to make before heading off to work overseas, it’s important to let your super fund know your new address so they can stay in touch.

Before you relocate overseas, it could be a good idea to take a few minutes to compare superannuation funds to be sure your current fund is right for your needs. It’s one less thing to worry about as you settle into your new work environment.

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