Super Guarantee rises to 11% for eligible employees
01 July 2023
5
min read
The rate of compulsory super that employers pay workers rose from 10.5% to 11% from 1 July 2023.
We are committed to making it easy for employers to meet their superannuation obligations by keeping them up to date on the latest news that may affect them.
Helping you understand how to meet your superannuation requirements means you can get on with running your business.
Super Guarantee
The Superannuation Guarantee (SG) is the minimum amount that you must pay into an eligible employee’s super fund.
As of 1 July 2023, the SG rose from 10.5% to 11% of an eligible employee’s ordinary time earnings (OTE). OTE is generally what employees earn for their ordinary hours of work, including commissions, shift loadings and allowances, but not overtime payments.
According to the Australian Taxation Office, employers must pay the SG at least four times a year, by the quarterly due dates.
Employers must pay and report super electronically in a standard format, ensuring they meet SuperStream requirements, and your super payments must go to a complying super fund.
If you don’t pay the SG on time, you may have to pay the super guarantee charge.
Superannuation guarantee increases
Under the current legislated timetable, the SG rate rose from 9.5% to 10% on 1 July 2021 and will continue to rise incrementally by 0.5% each financial year to 12% by 1 July 2025.
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1 July 2021
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10.0%
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1 July 2022
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10.5%
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1 July 2023
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11.0%
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1 July 2024
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11.5%
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1 July 2025
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12.0%
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Next steps for employers
Make sure your business can make the changes you need to pay your super obligations.
Steps include:
Checking with your payroll provider on making the changes and if there are any costs.
If you have a Human Resources Information System (HRIS), are there any changes needed through this platform that you need to allow time for?
Identifying any key employee documents that may need to be updated.
Frequently asked questions about the SG rate
If your question is not answered below, please feel free to contact us.
When do I need to pay super contributions?
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Employers need to make SG contributions at least four times a year (quarterly), and some super funds and industry awards require you to pay super more frequently.
Find out more.
Do I need to pay super for casual eligible employees?
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Yes, under the legislation, you do need to pay SG contributions for casual eligible employees.
Do I need to pay super during parental leave?
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The Australian Government has not changed the legislation around SG contributions on paid parental leave, which means employers do not have to pay SG contributions for employees who are away from work and not receiving pay. In the case of parental leave, although you still pay your employee the national minimum wage for 18 weeks while they're on Centrelink's paid parental leave, you don't have to make SG contributions.
If you offer additional paid parental leave, you may wish to check with the ATO about whether you need to pay SG contributions, as it can depend on your award, employee agreement/contract, or super fund rules.
Do I need to pay super on overtime?
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No, you do not need to pay super on overtime hours, even if the overtime payment is regular, frequent, or bundled into the employee's total salary package.
However, if you can't identify the exact amount of overtime, then you need to pay SG contributions on all the hours the employee worked that day.
Find out more.
Do I need to pay super on bonuses?
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Yes, if you are paying a bonus for work an employee did during their normal hours of work, you need to make SG contributions on the bonus amount.
However, if the bonus is being paid for work done during overtime hours, you don't need to pay SG contributions on the bonus.
Find out more.
Do I need to pay super on long service leave?
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Yes, if an employee is taking long service leave, it is counted as ordinary time earnings (OTE), and SG contributions must be paid. This also applies if long service leave is ‘cashed in’ while the employee remains employed.
An exception applies if a lump sum is paid upon termination of employment in lieu of unused long service leave. As this is not considered to be OTE, employers are not required to pay SG contributions on the lump sum payment.
Whilst we take all possible care when preparing this material using sources that we believe are reliable and accurate at the time of publication, we cannot give a warranty in respect to the information provided. Please seek professional advice before acting on this information.