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Superannuation Guarantee for employers

Superannuation is the money which employers pay for their workers/employees retirement benefits in addition to the wages. Generally if any employee is paid $450 or more (before tax) in a calendar month, the employer is liable to pay superannuation.

The minimum amount of employer contribution is called Superannuation guarantee (SG) and can be calculated using the superannuation guarantee contributions calculator:

  • The SG is currently 9.5% of an employee’s normal time earnings.
  • Employer should pay SG at least 4 times per year, by the quarterly due dates.
  • Employers must pay into complying Superannuation fund.
  • If employers fail to provide SG on time they may be charge to pay Superannuation guarantee charge.
  • If taxpayers engage someone to do work of a domestic or private nature for 30 hours or more per week and pay them $450 or more (before tax) in a calendar month, you have to pay SG for them. ‘Domestic or private’ means work relating personally to taxpayers (not to a business of yours), or work relating to their home, household affairs or family – such as a nanny or housekeeper.
  • If taxpayers use funds from the National Disability Insurance Scheme (NDIS) to engage a domestic help, they may have to pay SG for these workers.

Superannuation Guarantee Charge

If employer don’t pay the minimum amount of SG for their employees into a correct fund by the end of due dates, they are required to pay the Superannuation guarantee charge (SGC)

The charge includes the following amounts:

  • SG shortfall amounts calculated on their employee’s salary or wages.
  • Interest on those amounts outstanding. Current rate of interest is 10%.
  • An administration fee. Current administration fee is $20, per quarter

Payments dates

Employers must file their SGC statements and pay the charge by the due date

Quarter Period Due dates
1 1July – 30 September 28 November
2 1 October-31 December 28 February
3 1 January- 31 March 28May
4 1 April – 30 June 28 August

Taxpayers have to pay Superannuation for some contractors, even if they have an Australian business number (ABN). Taxpayers pay Superannuation no matter whether the employee:

  • Is full-time, part-time or casual.
  • Receive a Superannuation pension or annuity while still working – including those who qualify for the transition-to-retirement measure.
  • Is a temporary resident – when they leave Australia, they can claim the payments you made through a ‘departing Australia Superannuation payment’
  • Is a company director
  • Is a family member working in your business – provided they are eligible for Superannuation guarantee?

Employees not eligible for Superannuation

Taxpayers don’t have to pay SG for:

  • Non-resident employees taxpayers pay for work they do outside Australia
  • Some foreign executives who hold certain visas or entry permits (call 13 10 20 for information)
  • Employees provided benefits under the Community Development Employment Program
  • Members of the army, naval or air force reserve for work carried out in that role
  • Employees temporarily working in Australia who are covered by a bilateral Superannuation agreement. Taxpayers must keep a copy of the employee’s certificate of coverage to check the exemption.

If taxpayers are a non-resident employer, they don’t have to provide SG for resident employees for work they do outside Australia.

Super for minors
If a staff member is less than 18, they must work at least 30 hours and earn at least $450 a month to be eligible for SG.

For more information on Superannuation for employers from ATO website by clicking here.

Disclaimer : All the content (including Blogs, newsletters, Fact sheets, calculators etc.) provided on this website is general information only and is neither intended to nor be considered personal financial or taxation advice. The content has been prepared without taking into account your personal circumstances, financial situation or objectives. In making any financial, investment or taxation decision, information provided on this website should not be relied upon and you should seek personal advice. AVS Business Services Pty Ltd disclaims any responsibility for any decision that you make, based on the information provided on this website.All the information provided on this website is prepared in good faith and based on AVS’s knowledge and understanding of superannuation, taxation and other relevant laws and is believed to be correct at the time of writing the information. However as the laws, being dynamic by nature, keeps on changing, you should not rely on the information provided on this website without first obtaining advice from qualified professional.