As of the 1st of July 2022, the super guarantee rate is increasing from 10% to 10.5% and the $450/month eligibility threshold for when the super guarantee is paid, will be removed.
The key take-homes is to understand whether you have to pay super for your employees. This may include contractors and anyone that is under the age of 18.
Once you’ve determined which employees/contractors are eligible for super contributions, you also need to consider which payments are ordinary time earnings (OTE). This is the amount you pay employees for their ordinary hours of work.
From there, you need to select a super fund to pay your employee’s super contributions. Using their TFN’s to pay their fund of choice, or select your own default super fund.
You must pay your employees by the quarterly due date, otherwise, you will be charged a super guarantee charge.
In one instance, we had a client that attempted to apply for a superfund in 2019 for their employees, but then got side-tracked. Fast-forward to 2022, a disgruntled employee reported their employer to the ATO, and she was forced to pay 3 years of penalties. There is no longer an excuse.
Finally, keep an accurate record of your super payments, in english, for 5 years, with receipts or documents issued by the fund showing you’ve made contributions, and how much SG you have paid for each employee, and how it was calculated.
For more information, contact us today or speak with your professional accountant.