The Turnbull Government announced that they will provide the ATO with additional funding for a Superannuation Guarantee Taskforce. The taskforce will crackdown on employer non-compliance.
The ATO released a media statement on 29 August that the super guarantee gap for the 2014-15 year is estimated to be $2.85 billion, which represents 5.2% of the total estimated $54.78 billion in super guarantee employers were required to pay. “While this analysis shows that 95% of the estimated superannuation guarantee is paid to employees, the gap exists because some employers appear not to be meeting their super guarantee obligations either by not paying enough or not paying it at all”, Deputy Commissioner James O’Halloran said.
The package includes measures to require superannuation funds to report contributions received more frequently, at least monthly, to the ATO. The Government says this will enable the ATO to identify non-compliance and take prompt action and roll out Single Touch Payroll (STP).
What is your super guarantee obligation?
Generally if you pay an employee $450 or more before tax in a calendar month, you are required to pay super on top of their wages. This is called the superannuation guarantee (super guarantee) and is currently 9.5% of an employee’s ordinary time earnings. As an employer you must report and pay your employee super guarantee in an electronic standard format ensuring SuperStream requirements are met. This must be done at least four times per year, by the quarterly due date
The super guarantee gap is an estimate of the difference between the value of super guarantee contributions required to be paid under the law and actual super guarantee contributions made. This is referred to as the net gap as it recognises the impacts of our compliance activities.
Employers with 20 or more employees will transition to STP from 1 July 2018 with smaller employers (ie with 19 or less employees) moving to STP from 1 July 2019. This is designed to reduce the regulatory burden on business by aligning payroll functions with regular reporting of taxation and superannuation obligations. It should also improve the effectiveness of the ATO’s recovery powers, including strengthening director penalty notices and the use of security bonds for high-risk employers. This is to ensure that unpaid superannuation is better collected by the ATO and paid to employees’ super accounts while giving the ATO the ability to seek court-ordered penalties in the more severe cases of non-payment. This is including employers who are repeatedly caught but fail to pay superannuation guarantee liabilities.
If you are not sure if you are up to date with your superannuation guarantee obligations then contact us today so that we can help!