Superannuation Guarantee: Amnesty to correct historical compliance errors and omissions

Published Jun 19, 2018

GENERAL

Superannuation Guarantee (SG) commenced on 1 July 1992, employers generally needed to provide a minimum level of superannuation support for employees.  Generally speaking, this included making a payment of superannuation guarantee which was calculated as a percentage of an employee’s ordinary times earnings for the financial period.

An employer is required to make the superannuation guarantee payment for an employee within 28 days of the end of the financial quarter.  The payment must be made on an employee’s behalf to a complying Australian superannuation fund.

Failure to make the superannuation guarantee payment for an employee by the due date results in the Australian Taxation Office levying the employer with a Superannuation Guarantee (SG) charge.  The SG charge payments are not tax deductible for the employer and include:

• amount of the SG shortfall
• interest from the shortfall date to the payment date
• an administrative fee of $20 per quarter per employee where shortfall exists

AMNESTY

Employers have 12 months from 24 May 2018 to make good on previous superannuation guarantee non-compliance.

If the Amnesty applies the employer will:

• not incur an administrative fee
• pay employee shortfall to a complying Australian superannuation fund
• pay the interest charge to the employee complying Australian superannuation fund
• be able to claim a tax deduction for the shortfall and interest payments

This is an important concession.

EMPLOYER OPPORTUNITIES

• current businesses can claim a tax deduction for the SG shortfall and interest payments
• make your business SG compliant and avoid ATO review and harsh penalties when the Amnesty is finished on 23 May 2019
• small businesses that have operated for a long time may have unmet SG obligations for business owners, company directors and working family members.  The Amnesty is an opportunity to correct these shortfalls, incur a business deduction for the total shortfall and interest AND the individuals will not breach their concessional contributions cap as a result of an SG payment made under the Amnesty provision

Take advantage of the Amnesty if your business has a Superannuation Guarantee shortfall.  Contact your Forsyths Advisor for a Superannuation Guarantee Amnesty Review. 

Timothy Brett

Any advice contained in this material is General Advice and does not take into account any person’s individual investment objectives, financial situation or needs. Any representations, opinions or statements are based on our understanding of the relevant legislation as at the date of issue. Although every effort has been made to verify the accuracy of the information contained in this material, Forsyths Business Services, its officers, representatives, employees and agents disclaim all liability (except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this material or any loss or damage suffered by any person directly or indirectly through relying on this information. Accounting & Business Services are provided by Forsyths Business Services Pty Ltd ABN 66 182 781 401, liability is limited under a scheme approved under Professional Standards Legislation.