Superannuation contributions by employers on behalf of their employees is currently 9.5% of their Ordinary Times Earnings (amount paid for ordinary hours of work including unstructured overtime, commissions and shift allowances) for the year ended 30 June 2021.
From 1st July 2021, the rate increases to 10%, meaning that contributions made in relation to salary and wages paid for the year ended 30 June 2022 will be subject to the higher 10% rate.
The contributions rate is scheduled to increase by 0.5% per year until it reaches 12% from 1 July 2025. This may be subject to change.
Employers must make superannuation guarantee contributions for their employees on a quarterly basis within 28 days after the end of each quarter (September, December, March and June).
Failure to make the payment for Super
· If you fail to make the payment for the June quarter by 30 June 2021, the tax deduction is deferred until the 2022 year.
· A recent release from the Tax Office reminded all employers that deductions are not allowed when contributions are made via a clearing house until the payment has actually been paid by the clearing house to the trustee of the fund, and that this may take several days upon receipt by the clearing house.
· If you fail to make the payment by the 28th day after the end of each quarter, it could result in the employer being denied a tax deduction completely.
· If an employer company fails to pay superannuation on behalf of employees, the Directors can be held personally liable for the amount due. This also goes for taxes that the company has not paid to the ATO arising from GST or Pay As You Go Withholding deducted from employees’ wages.
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