With the end of the first financial quarter (July 1 to September 30) now behind us, the crucial deadline for your employee superannuation contributions is fast approaching. The full amount (at the new rate of 12%) must be received by the super funds on or before October 28th.
Missing this deadline, or any quarterly deadline, triggers the ATO’s heavy-hitting penalty regime, the Superannuation Guarantee Charge (SGC).
The ATO is crystal clear: Your employee’s super contribution is only considered ‘paid’ on the date it’s received by the super fund, not the date it’s received by your clearing house. You must factor in processing time to meet the October 28th cut-off.
Late Super? Now What? The Super Guarantee Charge (SGC) Explained
If you miss the deadline for any quarter—past or present—the consequences are severe, immediate, and non-negotiable.
The moment a payment is late, it becomes non-deductible – The expense is no longer tax deductible against your business income.
The late payment is no longer calculated on Ordinary Time Earnings (OTE), but on the employee’s gross salary or wages, which typically includes things like overtime and allowances, increasing the overall shortfall.
You must pay the SGC to the ATO, which has three non-deductible components:
– The Super Guarantee Shortfall (calculated on gross salary/wages).
– Nominal Interest (10%): This is a fixed, annual rate on the shortfall amount.
– An Administration Fee ($20 per employee, per quarter).
Directors of a company can be personally chased by the ATO for the unpaid super amount. Authorise the payment now!
If you are struggling to calculate your liabilities, are already behind, or simply need a system to ensure you never miss a deadline again, we can help.
Contact us today to streamline your payroll and superannuation compliance and ensure your business avoids costly ATO penalties.
