Changes to superannuation regulations as an employer

Superannuation choice and stapled funds

From 1 November 2021 there are new rules regarding super funds for new employees. If a new employee commences employment and they don’t choose a super fund, you will need to request their stapled super fund details from the Australian Taxation Office (ATO).

In the case where you make the contribution to your default fund without making a stapled super fund request you may be liable for the super guarantee penalty.

Visit the ATO website for further information on these new super rules and how to request stapled super fund details.

Paying your Superannuation Guarantee late will cost you

As a result of improved reporting of superannuation obligations, the ATO now has real time ability to assess if your employee’s superannuation guarantee is paid on time.

The penalties for late payment of your employee’s superannuation is significant even if the payment is a single day late.

The due date for payment of superannuation guarantee is 28 days following the end of each quarter

Quarter

Payment due

1 October – 31 December 2021

28 January 2022

1 January – 31 March 2022

28 April 2022

1 April – 30 June 2022

28 July 2022

1 July – 30 September 2022

28 October 2022

Important Note: a superannuation guarantee contribution is considered paid when the superannuation fund receives it and not the date you pay it.

What are the consequences of a late or missed Superannuation Guarantee payment?

If you miss a payment you will need to pay a superannuation guarantee charge and lodge a superannuation guarantee charge statement with the ATO. The superannuation guarantee charge is not tax deductible. Therefore, even if you are a single day late with your payment you cannot claim a deduction for the superannuation payment.

The Superannuation Guarantee Charge is made up of the following:

  • Superannuation guarantee amount.
  • Interest on those amounts (currently 10% calculated from the start of the quarter until the date the superannuation guarantee form is lodged).
  • An admin fee of $20 per employee per quarter.

Further, if the superannuation guarantee charge remains unpaid the directors of the Company can become personally liable for any unpaid superannuation.

The ATO can also apply what is known as a Part 7 penalty and apply a general interest charge to the outstanding amount.

Please take the time to review your processes to ensure that your employees are receiving the right amount of superannuation guarantee and that it is being paid on time to avoid unnecessary penalties.

Superannuation for contractors

Did you know you may be liable to pay superannuation for contractors if you pay contractors mainly for their labour, regardless of whether they hold an ABN. Where this is the case the contractors may be treated as employees for superannuation guarantee purposes and therefore you are liable to pay 10% superannuation on their ordinary times earnings.

Visit the ATO website for further information on paying superannuation for contractors.

If you would like further information in relation to your superannuation guarantee obligations, please contact our accounting team on 03 9325 6300.

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