Based on the December CPI figures, the General Transfer Balance Cap will increase from $2m to $2.1m on 1^st July 2026.

This means that pensions commenced from 1 July 2026, for a pensioner who has not commenced a pension previously, will have a $2.1m transfer balance cap. How this increase will be applied to existing pensioners depends on a convoluted calculation based on the percentage of previous transfer balance caps that have been utilised. As the personal transfer balance cap for every existing pensioner will be unique, it will need to be calculated separately. I expect that many will rely on the information that will become available on the MyGov website to learn their new cap. The only general comment that can be made is that any existing pensioner that has utilised all their transfer balance cap previously will not receive any uplift at all.

The General Transfer Balance Cap is also applied to the level of non-concessional contributions that may be made. Interestingly, subject to the final AWOTE figures due out at the end of February, it is almost certain that the concessional contribution cap will increase from $30,000 to $32,500 on 1 July. This will increase the standard non-concessional contribution cap from $120,000 to $130,000 and the 3-year bring forward cap to $390,000.

The current year position is as per this table.

From 1 July 2026. this table will apply if contribution caps increase

From 1 July 2026, this table will apply if contribution caps remain as they are

It will be interesting to see if the Government will apply the increase to the Div 296 $3m and $10m caps. It would be tidy if they did so, but I don’t expect it.