A plain‑English guide to the Low‑Income Superannuation Tax Offset

Superannuation is designed to reward people for saving for retirement.
But for many years, people on lower incomes were actually paying more tax on their super contributions than on their wages.

That’s what LISTO is designed to fix.

LISTO stands for the Low‑Income Superannuation Tax Offset. It’s a government payment that goes directly into an eligible person’s super account, refunding the contributions tax that would otherwise reduce their balance.

Why LISTO exists

Employer super contributions are generally taxed at 15% inside super.

For people on lower incomes, their personal tax rate can be lower than 15% – or even zero. Without LISTO, contributing to super wouldn’t actually be a tax benefit at all.

LISTO exists to make sure lower‑income earners aren’t disadvantaged simply for saving for retirement.

What has changed?

As part of the Building a Stronger and Fairer Super System legislation, Parliament has expanded LISTO.

From 1 July 2027:

• The income threshold increases from $37,000 to $45,000
• The maximum payment increases to $810 per year
• More Australians will qualify – particularly part‑time workers and women

A simple example

Imagine someone earning $40,000 a year.

Their employer pays super, but 15% contributions tax reduces what stays invested. Under the updated LISTO rules, the government refunds that tax back into their super account.

There’s no application.
No forms.
It happens automatically.

Over time, these refunds can make a meaningful difference to retirement outcomes.

Who is LISTO most relevant for?

LISTO is especially important for:

• People earning under $45,000
• Part‑time or casual workers
• Parents moving in and out of the workforce
• People with multiple jobs
• Anyone early in their career

It’s a quiet benefit – but a powerful one.

Putting it into perspective

While many super headlines focus on high balances and new taxes, LISTO is a reminder that the system is also being adjusted to better support people at the lower end.

If you’re unsure whether LISTO applies to you, it’s worth checking. Sometimes the most valuable super benefits are the ones no one talks about.