As you know it is employer’s liability to pay super on time, what you need to know is how crucial it is NOW to make this payment on time and how costly it can be if you do not.

  • In our quarterly reviews we advise client’s of their liabilities and obligations.
  • To date no client has requested we act for them in completing a SGC statement, all preferring to handle this on their own.
  • Post September 2020 there is no avoiding the payment of a penalty if you pay SG late.
  • If you are discovered in an audit the penalty increases substantially.

Super Guarantee (SG) – 9.5%

  1. SG is money you pay for your workers to provide for their retirement.
  2. Generally, if you pay an employee $450 or more before tax in a calendar month, you have to pay super on top of their wages.
  3. The minimum you must pay is called the super guarantee (SG):
  • the SG is currently 9.5% of an employee’s ordinary time earnings
  • you must pay the SG at least four times a year, by the quarterly due dates (28 days after the end of the Quarter).
  • you must pay and report super electronically in a standard format, ensuring you meet SuperStream requirements
  • your super payments must go to a complying super fund – most employees can choose their own fund

 

Superannuation Guarantee Charge (SGC)

  1. If you don’t pay an employee’s super (SG) on time and to the right fund, you must pay the SGC and lodge an SGC statement to the ATO.
  2. You have until the 28th day in the following month to submit this SGC statement.
  3. Important: The SGC is not tax-deductible, nor is the late SG..

Once you are late paying SG you MUST lodge a SGC statement and pay.

The following links will assist you further in understanding this process:

https://www.ato.gov.au/business/super-for-employers/paying-super-contributions/missed-and-late-payments/the-super-guarantee-charge-(sgc)/

https://www.ato.gov.au/business/super-for-employers/

The post Superannuation Amnesty (September 2020) ATO attack on late super.

  • SG is due four times a year, by the 28th day after the end of the Quarter.
  • If you have not paid then your SGC statement is due on the 28th day of the next month.

There is an administration and interest payment to pay.

Then a penalty applies, approximately:

  • 20% – If you are late with SG BUT lodge a SGC statement before it’s due date.
  • 40% if the ATO tell you they are auditing you and then you lodge the SGC statement.
  • After that 100% and 200% start to become possibilities.

Unfortunately Super is high on the ATO compliance radar and they simply will not tolerate late payment of super, there is no wriggle room.

We suggest you:

  1. Diarise this payment obligation at least a week before it is due.
  2. Make the payment, Super cannot be placed on a payment plan without automatic penalty, creditors and the ATO/BAS payments can be more easily delayed.
  3. Should lodge a SGC statement once you are late to minimize your penalty.

 

If an ATO inquiry results it can be time consuming and costly, we recommend you take up Audit Shield protection as Audit fees can be quite expensive as it is an additional consulting engagement. Please call me if required.

 

General Advice warning: the information in this article is general in nature, it is not advice specific to your needs. If you want to act upon the information in this article then you should seek advice from a qualified professional. VJC WM accepts no liability to any party for acting from this information unless they have sought advice in a formal engagement with VJC WM for this purpose.