Two things will be used to calculate whether people are eligible for the higher tax rate.
The first is their super earnings for the financial year,including withdrawals but minus contributions;and second,the proportion of those earnings above the $3 million threshold.
Their tax liability would be calculated using the following formula,the Department of Treasury says:
Tax liability= 15 per cent x earnings x proportion of earnings over $3 million
(The tax liability is calculated with a rate of 15 per cent,as all earnings over $1.7 million are already taxed at 15 per cent,this adds the additional levy.)
Treasury says if an individual makes losses in a financial year,those can be carried forward to reduce their tax liability in future years.
Take Warren,an example created by the department. He is 52 and has $4 million in super at June 30,2025. He makes no contributions or withdrawals,and by June 30,2026 his balance is $4.5 million. That means Warren’s earnings are $500,000,and his proportion of earnings corresponding to funds above $3 million are 33 per cent.
So his tax liability for 2025-26 is 15 per cent X $500,000 X 33 per cent,which is $24,750.
The department has more examples here.