If you’re a low-income earner, saving for your retirement can feel daunting. Fortunately, the Australian Government have some programs to help you prepare, including the Low Income Super Tax Offset (LISTO).
What does the Low Income Super Tax Offset program offer?
The Low Income Super Tax Offset is a government program to help low-income earners save for their retirement.
So, to put it in the simplest terms, if you earn $37,000 (or less) a year the government will make a payment of up to $500 directly into your super fund.
How do I know if I’m eligible for the Low Income Tax Super Offset?
To be eligible for the LISTO there are a few criteria you must meet (and you have to meet all of them):
- Your employer (or you if you’re self-employed) pay concessional (pre-tax) superannuation contributions into a complying super fund. This includes your guaranteed super amount most people are paid as part of their wages (the 12% of compulsory super required to be paid by most employers, as of 1 July 2025).
- You earn $37,000 or less in the financial year based on your adjusted taxable income.
- Did not hold a temporary resident visa during the financial year (New Zealand citizens are eligible for the payment).
- A minimum of 10% of your total income comes from employment and/or business.
- Your super fund has your Tax File Number.
How much will I receive?
The amount of Low Income Super Tax Offset the Government pays into your super account depends on your individual circumstances.
The LISTO is calculated at 15% of the pre-tax (concessional) super contributions paid into your super fund by you or your employer.
Therefore, if you qualify the maximum payment you can receive is $500 and the minimum is $10. (If you fall below $10, the government will just round up to $10).
Here’s how to work out your Low Income Tax Super Offset contribution:
If you meet all of the criteria list above, there’s a simple method to work out your payment.
Tom works part-time in a supermarket and earns a yearly income of $35,500 before tax. During the financial year, Tom’s employer makes the standard 12% superannuation guarantee payment into his super fund, meaning they pay $4,260 into his super fund.
More than 10% of Tom’s income comes directly from his employment. His employer has made direct contributions into his super fund from the compulsory super guarantee. As a result, Tom is eligible for a payment of 15% of the $4,260 super guarantee payments.
Therefore, Tom’s LISTO payment is:
15% x $4,260 = $639
However, there is an annual cap of $500, which means Tom will receive the full $500 amount for the corresponding financial year.
How do I get my Low Income Tax Super Offset payment?
It’s easy, the government will sort it out for you. Firstly, the most important part is to make sure your super fund has your tax file number or you could miss out on the payment.
Once you lodge a tax return, your LITSO is an automatic payment paid directly into your super fund.
If you haven’t lodged your tax return, then you’ll still receive the payment. However, your eligibility is determined from the information that can be collected about you from your super fund and other ATO information.
As a low income earner are there any other ways I can better plan for retirement?
Even as a low income earner you can still take steps now to prepare for retirement. In addition to the LISTO program, the government also has another program called the Government Super Co-Contribution Scheme.
This scheme is an incentive for low to middle income earners to make voluntary (post-tax) contributions into their superannuation funds.
Therefore, the government will contribute a maximum of 50 cents for every extra dollar you contribute to your super fund up to a maximum of $500 per year, depending on your income.
You can read more about the Super Co-Contribution Scheme here.
Want more information about Superannuation?
If you would like more information about superannuation be sure to visit our super articles listed below to learn how you can prepare better for your retirement.
