Proposed Superannuation Guarantee Changes
The law currently requires any employers that lodge their employees Superannuation payments late to lodge an SUPER GUARANTEE Charge Statement. This law remains in effect and includes a compulsory administrative payment of $20 per employee, per period for the employer lodging the SUPER GUARANTEE Charge Statement.
The government is currently considering legislation known as the Superannuation Guarantee amnesty. The proposed amnesty provides employers a single opportunity to amend any previous errors in their superannuation guarantee payments without the threat of financial penalty. As at 6 December 2018 this bill was still under consideration and the government had concluded for the year.
Amendments to previous errors will include interest adjusted back payments of super. The interest will be applied by an ATO ruling rate.
The legislation which would give effect to this amnesty was first considered by parliament on the 24th May 2018. If this legislation is passed the amnesty would be effective for a period of twelve months between 24 May 2018 to 23 May 2019.
Once the law is passed, the Australian Taxation Office will backdate the financial relief for any employers who make disclosures during the amnesty period, subject to the eligibility criteria.
Eligibility requirements for the proposed Superannuation Guarantee amnesty:
Employers must choose to disclose any short payments or missed payments in Superannuation Guarantee (which have not previously been disclosed to the Australian Taxation Office) made between 1 July 1992 up to 31 March 2018
Employers must make this disclosure during the twelve month amnesty period of 24 May 2018 to 23 May 2019
Employers can’t be undergoing an audit of their Superannuation Guarantees for the period
Beginning with 1 April 2018 there will be no further Superannuation Guarantee amnesty benefits available and regular penalties for missed payments and alike will face fines.
Employers whose superannuation guarantee is under audit:
Any periods for which the employers superannuation guarantee are being audited will not have the benefit of the amnesty available to them. The Australian Taxation Office is able to audit employers superannuation guarantee at any time. Often times an audit commences following notification from an employee that they have not received their superannuation guarantee payments.
Further description of the benefits of the proposed superannuation guarantee amnesty:
If the proposed legislation is enacted by the Government, the benefits will be back dated to the dates listed in the proposal, subject to the eligibility requirements being fulfilled.
Advantages are as follows:
The administrative component of $20 per employee, per period (known as the Superannuation Guarantee charge) will be waived
There will be not application of the Part 7 Penalty
Any payments to catch up on the Superannuation Guarantee shortfalls that are made during the twelve month amnesty period will be tax deductible
How do employers receive the benefits of the proposed amnesty:
The Australian Taxation Office advises employers that have made errors with their Superannuation Guarantee payments to lodge an SUPER GUARANTEE Charge statement and remit the outstanding amounts to the Australian Taxation Office.
Current law will be applied to the SUPER GUARANTEE Charge statements. However, the Australian Taxation Office will backdate the amnesty if the Government enacts the legislation.
When is payment of the outstanding superannuation guarantee required:
In order to receive the benefits of the proposed amnesty payment is required. To reduce the general interest charge (GIC) component you are liable for, payment should be made as soon as possible.
To process a payment you will require your payment reference number.
The Australian Taxation Office will then contact the employer to organise a payment plan.
If you need to make changes to your payment plan or create a new payment plan, contact us, the Great Bean Counters as soon as possible to approach the ATO.
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