Superannuation for Backpackers: The 12% You Should Not Ignore

Superannuation is money your employer pays into a retirement fund on top of your wage. It is not deducted from your pay, and on a working holiday it adds up faster than most people realise.

How Much Is It?

The superannuation guarantee rate for 2026-27 is 12% of your eligible earnings. On $1,000 of ordinary time earnings, $120 goes into your fund on top of your $1,000.

From 1 July 2026, employers generally have to pay it on each payday under the payday super rules, rather than quarterly. That is good news for backpackers: it is much easier to spot an employer who is not paying it.

The maximum contribution base for 2026-27 is $270,830, which is irrelevant for most working holiday jobs.

Source: ATO superannuation.

Why It Matters Even If You Leave

Two reasons.

First, you can claim most of it back when you leave Australia for good, through a DASP claim. That is your money.

Second, if you end up staying, it is the difference between a deposit one day and nothing. Plenty of working holidaymakers end up staying. I arrived in 2010 and I am still here.

Choosing a Fund Without Getting Burned

You do not have to accept your employer's default fund. You can nominate your own, and you should look at two numbers:

• The admin fee, which is charged whether or not the fund performs.
• The investment fee, which comes out of your returns.

A high-fee fund on a small balance can quietly eat most of your growth. Moneysmart has a free super comparison tool, and the ATO has a your-super tool that lists every account attached to your TFN.

My own experience is the cautionary tale. I did not choose a fund, I took advice from the wrong place, and the fund ended up in a class action. For years my balance sat in cash and made no gains at all, which is the part that still annoys me. When the class action settled I got about $300 back. My balance had missed out on roughly $100,000 over the years. Choosing deliberately takes twenty minutes, and checking that your fund is actually invested, not parked in cash, takes five.

What To Do When You Start a Job

1. Give your employer your TFN. Without it, your super is taxed more.

2. Nominate your own fund, or at least check the default one's fees.

3. Check your first payslip for the super line, then check the fund's app to confirm the money actually arrived.

4. If it did not arrive, ask payroll in writing. Keep the email.

5. When you change jobs, use the same fund so you are not paying two sets of fees.

Consolidating

If you have three funds from three jobs, consolidate into one. The ATO tool finds them, and most funds have a consolidation form. Do it while you are in Australia, because it is much harder from overseas.

Common Misunderstandings

• "Super comes out of my pay." It does not. It is on top of your ordinary earnings.
• "I will get all of it back." DASP is taxed at 65% on the taxable component when you leave.
• "Cash in hand is better." It is not. No super, no payslip, no proof, and no protection if you are injured. See underpaid at work.
• "It is only for permanent residents." Anyone working legally in Australia earns it.

Keep reading:

• Claiming Super When You Leave Australia
• How Much Tax Do Backpackers Pay?
• Superannuation vs Pension