How do I make sense of all the different superannuation caps?

Q: Could you clarify whether there is a cap on the amount that can be held in a super fund’s accumulation account? While the cap on starting a pension account is $1.9 million, it is not clear whether there is one on the accumulation account – other than the planned extra tax on amounts above $3 million. It also seems that when the total super balance exceeds $1.9 million, any further non-concessional contributions would be subject to an extra tax. Is this understanding correct? Chris

A: Our superannuation system has a lot of caps and specific limits in place on certain entitlements, such as the contributions you can make and the amounts you can transfer to pensions. Hence, it’s important to know how they apply.