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Employers participating in the Superannuation Guarantee amnesty that was introduced on 6 March 2020 need to apply for the amnesty by 7 September 2020.
The Australian Tax Office (ATO) may be able to help employers impacted by economic changes due to COVID‑19.
Paying super is an important part of being an employer and employers face penalties for not paying or underpaying super contributions on behalf of employees.
The Super Guarantee is the minimum amount that an employer must pay into an employee’s superannuation fund. It is currently 9.5% of gross salary.
On 6 March 2020 the Australian Government introduced a Superannuation Guarantee (SG) amnesty for employers to “self-correct” past unpaid SG amounts.1
The amnesty allows employers to disclose and pay previously unpaid Super Guarantee payments, including nominal interest, that they owe their employees from between 1 July 1992 to 31 March 2018.
According to the ATO, eligible disclosures under the amnesty would not incur the Part 7 (Superannuation Guarantee (Administration) Act 1992) penalty or the $20 per employee per quarter administration penalties.
Employers who take advantage of the SG amnesty will be able to claim a tax deduction for SG payments made after 24 May 2018 and before 11:59pm on 7 September 2020.
When employers pay outstanding SG contributions, they would pay employees:
If the ATO identifies employers who have not paid their employees’ SG and have not come forward, they will not be eligible for the benefits of the amnesty.
If this happens, the employer will also be required to pay the SG shortfall and be penalised up to 200% of the SG charge.
Additionally, the employer will pay nominal 10% interest, plus the administration penalties, plus payments of the SG charge won’t be tax deductible.
The ATO said it would work with employers financially impacted by COVID-19 to make a payment plan to help an employer to continue making payments.
The plan may include flexible payment terms and amounts that can be adjusted if the employer’s circumstances change and the ability to extend the payment plan to beyond the end of the amnesty period in September.
More frequent reporting requirements mean employers are under increased monitoring to identify underpaid SG.
Extra real-time data available through single-touch payroll systems has allowed the ATO greater capability to identify employers who have underpaid or not paid staff their super entitlements.
The ATO said it was increasingly using this capability to identify employers that have underpaid SG.
Quarters that qualify for the amnesty.
If an employer has already notified the ATO of unpaid super during this time, there is no need to apply for amnesty or lodge again.
An employer needs to apply for the amnesty on the SG amnesty form to be considered for amnesty.
Payments of SG by the employer are eligible for the tax deduction under the amnesty.
The opinions expressed by the ATO are theirs alone, and do not necessarily reflect the opinions of the QSuper Board. No responsibility is taken for the accuracy of any of the information supplied and you should seek advice for your circumstances.
1. Australian Government, 6 March 2020, Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019, at https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r6413
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