Can I put my redundancy payment into super?

Let's answer it in the first paragraph, because if you're reading this you've probably just been made redundant and you don't want to hunt for it.

You generally can't roll a redundancy payout into super — but you can usually take the cash and contribute it. The Australian Taxation Office puts the first half plainly: you can't roll over an employment termination payment to your superannuation, and employment termination payments made after 30 June 2007 cannot be contributed to or rolled over into super in that direct sense (Australian Taxation Office, https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/leaving-your-job/employment-termination-payments-for-employees). What you can do is receive the money and then make an ordinary personal contribution with it. Those are two different mechanisms with two different sets of rules, and confusing them is why this question is so hard to get a straight answer to.

So the real question isn't "can I?" It's "which route, under which cap, and should I?" This article is general information only, not personal tax or financial advice — and this is genuinely a decision to check with an accountant or adviser before you move the money.

Is your payout one thing?

Before you can plan anything, get the breakdown from your employer's termination statement, because a redundancy payout is several different payments wearing one name, and they don't behave the same way.

The genuine redundancy tax-free amount is a base amount plus an amount for each completed year of service. For the 2026–27 income year the tax-free base limit is $13,598, plus $6,801 for each completed year of service (Australian Taxation Office, https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/leaving-your-job/genuine-redundancy-payments). That portion is tax-free, and importantly it is not an employment termination payment.

The employment termination payment, or ETP, is the taxable balance. It's taxed concessionally up to certain caps, with the rate depending on your age relative to your preservation age. For 2026–27 the ETP cap is $270,000, which is indexed each year, while the separate whole-of-income cap is $180,000 and is not indexed — and that second cap is reduced by other taxable income you receive in the year, such as salary or wages. Anything above the applicable cap is taxed at the top marginal rate of 45 per cent plus the 2 per cent Medicare levy (Australian Taxation Office, https://www.ato.gov.au/tax-rates-and-codes/key-superannuation-rates-and-thresholds/employment-termination-payments).

Then there's unused annual leave and long service leave, taxed under their own separate rules and paid to you as cash — our article on leave payouts in retirement covers how those interact with the Age Pension — and ordinary wages owing, which is simply income. Our broader article on being made redundant in your 50s or 60s goes through the tax treatment of each in detail. What matters here is that only some of this is an ETP, and it's the ETP that people are usually asking about.

What distinction answers the question?

Rolling over means moving a payment directly into super without it passing through your hands. For a life benefit ETP — the ordinary kind you get on redundancy, as distinct from a death benefit ETP — that route is not available, and the ATO says so directly (Australian Taxation Office, https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/leaving-your-job/employment-termination-payments-for-employees). It's a genuine change that catches out people who remember when it was possible before July 2007.

Contributing means taking the money into your bank account, then making a personal contribution to your super fund. Nothing stops you doing that with redundancy money, exactly as you could with an inheritance or the proceeds of a sale. The practical consequence is worth stating baldly: there is no special "redundancy contribution" with its own generous cap. Once the money is in your hands it's just money, and the ordinary contribution rules apply to it.

Which route, and which cap?

Two ways in, and the right one depends on your circumstances and your year.

The non-concessional (after-tax) route is the usual one for a lump sum. For 2026–27 the non-concessional cap is $130,000, up from $120,000, and you may be able to use the bring-forward rule to contribute more than one year's worth at once — but that is gated by your total superannuation balance on 30 June of the previous financial year. If your balance was under $1.84 million you can bring forward three years, or $390,000; between $1.84 million and $1.97 million you get two years, or $260,000; and at $1.97 million or above you can't bring forward anything at all, though you can still make a current-year contribution of up to $130,000 (Australian Taxation Office, https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/non-concessional-contributions-cap). Our articles on non-concessional contributions, on the bring-forward rule and when not to trigger it, and on the total superannuation balance cover each in depth.

The personal deductible (concessional) route lets you claim a tax deduction for a personal contribution, which can be worth looking at in a redundancy year, because a large taxable termination payment may push you into a higher marginal bracket than usual. The concessional cap for 2026–27 is $32,500, up from $30,000 (Australian Taxation Office, https://www.ato.gov.au/tax-rates-and-codes/key-superannuation-rates-and-thresholds/contributions-caps), and you may have unused cap space from earlier years under the carry-forward rules. Our articles on claiming a personal super contribution deduction and on carry-forward concessional contributions explain the mechanics.

One trap worth naming: if you're claiming a deduction, the notice of intent has to be valid and lodged in the right order relative to anything else you do with that money. Get it out of sequence and the deduction can be lost — our article on the notice-of-intent ordering trap is about exactly this. And keep an eye on Division 293, because a year with a big termination payment can spike your income enough to bring it into play, which changes the maths on a concessional contribution.

What about eligibility and timing?

Age and work-test rules apply to personal contributions and differ by age band, so check where you sit before assuming you can contribute. Your fund also has to be able to accept the contribution, which isn't automatic — confirm with them.

Timing is by receipt: a contribution counts in the financial year your fund receives it, not the year you sent it. That matters enormously if your redundancy lands near 30 June, and it determines which year's caps you're using — which this year is a live issue, since the caps stepped up on 1 July 2026. And if you're finishing work mid-year, the 28-day superannuation guarantee rule in a final year of employment has its own quirk, which our article on that covers.

What is the Centrelink trap nobody sees coming?

This is the most valuable warning in the article, so please don't skim it.

If you're expecting to claim income support after a redundancy, be aware of the income maintenance period. Broadly, Centrelink can treat a redundancy payout as though it were income spread over a period, which can defer your payments for weeks or months (Services Australia, https://www.servicesaustralia.gov.au/income-maintenance-period). And here's the part that surprises people: putting the money into super does not make that go away. People contribute the lot, assume they've tidied it out of view, and then discover they've also got no income support for several months and no access to the money they just locked up.

Our article on the income maintenance period after a redundancy explains how it works. Check it before you decide what to do with the payout, not after.

What do the worked examples show?

These two show the same question producing opposite sensible answers. They are illustrative only, and not personal advice.

Consider Greg, 52, made redundant after 18 years with one employer, receiving a payout that includes a genuine redundancy tax-free amount and a taxable ETP, with no new job lined up and about four months of living expenses in the bank. His tax-free portion alone is substantial — a base of $13,598 plus $6,801 for each of his 18 completed years (FY2026-27) — and he is tempted to put the lot into super to "make it work harder" (Australian Taxation Office, https://www.ato.gov.au/individuals-and-families/jobs-and-employment-types/working-as-an-employee/leaving-your-job/genuine-redundancy-payments). On these facts that would be a serious mistake: Greg is nowhere near a condition of release, so contributed money is preserved and unreachable for more than a decade, and the Centrelink income maintenance period may defer any income support he claims regardless of where the money sits (Services Australia, https://www.servicesaustralia.gov.au/income-maintenance-period). On these facts it is generally rational for someone in Greg's position to keep the payout accessible as a job-search buffer and revisit the super question once he is re-employed.

Now consider Susan, 63, made redundant after 30 years and intending to retire rather than look for work, with $180,000 of accessible savings alongside her payout and a total superannuation balance of $900,000. Because her balance is well under $1.84 million, she has the full bring-forward available — up to $390,000 of non-concessional contributions across three years (FY2026-27) — and because her redundancy year income is unusually high, a personal deductible contribution against the $32,500 concessional cap (FY2026-27) may also reduce a marginal rate that is higher this year than it will ever be again (Australian Taxation Office, https://www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/growing-and-keeping-track-of-your-super/caps-limits-and-tax-on-super-contributions/non-concessional-contributions-cap; https://www.ato.gov.au/tax-rates-and-codes/key-superannuation-rates-and-thresholds/contributions-caps). On these facts it is generally rational for someone in Susan's position to take advice on splitting the payout between the two routes and to get the notice of intent sequenced correctly. The difference between Greg and Susan isn't the size of the cheque. It's whether they can afford to lose access to it.

What is the warning that matters most — preservation?

Everything above is mechanics. This is the judgement.

Money you contribute to super is preserved — you can't get it back until you meet a condition of release. If you're 60-something and genuinely retiring, that may be fine. If you're 52, just lost your job, and don't have another one lined up, then tipping your redundancy into super can be one of the worst things you could do with it. That payout may be the only thing standing between you and real hardship while you look for work, and once it's in super, it isn't yours to reach.

So the order of operations is: keep enough accessible cash to live on first. Then, and only then, consider what to do with the surplus. A redundancy is a moment for liquidity and options, not for locking things away — unless you're genuinely at the end of your working life and you've thought it through.

Should you get it checked before the money moves?

The component breakdown, the choice of contribution route, the cap headroom, the notice-of-intent ordering, the Centrelink interaction and the preservation question all interact — and most of it is difficult or impossible to unwind once done. An hour with an accountant or a licensed financial adviser, before the money moves, is genuinely well spent here.

What should you do in short?

You can't roll your redundancy payout straight into super — the ATO is explicit about that — but you can generally contribute the cash, as a non-concessional contribution of up to $130,000 (FY2026-27) or more under bring-forward, or as a personal deductible one against the $32,500 concessional cap if the tax position suits. There's no special redundancy cap; the ordinary rules apply. Get the component breakdown first, check your cap headroom and the timing, and look into the Centrelink income maintenance period before you commit. Above all, keep enough money out where you can reach it. Super is a fine destination for a surplus and a terrible one for your emergency fund.

Sources

• ATO — Employment termination payments for employees
• ATO — Genuine redundancy payments
• ATO — Employment termination payments: key rates and thresholds
• ATO — Contributions caps
• ATO — Non-concessional contributions cap
• Services Australia — Income maintenance period