ATO’s Spotlight on Super Guarantee

When was the last time you looked into your superannuation? With the increase of cost of living pressures, and many businesses struggling with their cashflow, it is imperative that our forced retirement saving contributions are being made by our employers. With some businesses being behind in their payments or going under and leaving their ex-employees without their entitled super payments being made, the ATO has decided this is an area that needs the spotlight to be shone on.

The ATO has advised, as part of their annual Corporate Plan, that one of their eight main focus areas for 2023/2024 will be “Superannuation guarantee (SG) integrity”.

From July 1, 2023 superannuation contributions rose from 10.5% to 11% of eligible employee’s earnings. They will continue to increase by half a percent, annually until July 2025 when they reach 12%, at which point this will then be reflected upon, by the ATO, and future plans will be discussed whether the rate will be adjusted. This may vary depending on different award agreements.

Small business debt in Australia has had an 89% increase from 30 June 2019. As of 30 June 2023 it reached a staggering $50.2 billion. Chris Jordan, Commissioner of Taxation believes, “It’s our responsibility to ensure a level playing field as we support businesses who are doing the right thing and paying on time”.

This is where the spotlight on super guarantee comes into play with the ATO.

The ATO will now be keeping a closer eye on businesses, big and small, who have a history of late payment, underpayment or non-payment of super guarantee to their employees.

Superannuation payments for each employee are required to be made at least quarterly (see dates below for more information) into a complying super fund or retirement saving account (RSA).

SQ Quarter: 1 July - 30 September

Date Payment Due: 28 October

SQ Quarter: 1 October - 31 December

Date Payment Due: 28 January

SQ Quarter: 1 January - 31 March

Date Payment Due: 28 April

SQ Quarter: 1 April - 30 June

Date Payment Due: 28 July

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By expanding the use of information from Single Touch Payroll (STP) software, The ATO will now combine this with data from super funds to track when employers pay employees super guarantee (SG).

“Our focus on expanding the use of data to improve super guarantee integrity in general will also continue in 2023–24.” said the regulator.

Because of this increased visibility from the ATO, it is imperative that employers review their superannuation processes and ensure payments are up to date. We suggest you start with these areas of focus:

Are your employee records and accounts up to date?
Have any historical miscalculations been identified and parties made aware?
Are your super payments up to date?
Are you paying the correct percentage to your employees?
Do you put aside super payments for your employees each pay run, so you are ready for the payment on the due date? (Note: from 1 July 2026 employers will be required to pay super each pay run, get in the habit now, and save yourself future cash flow issues)

As an employee, we suggest that you check in with your Super Fund provider, and ensure that payments are up to date, as well as at the correct percentage. Should you find any anomalies, we suggest you talk with your employer in the first instance. If this is unable to be resolved with your employer, then you can seek assistance from the ATO.

The ATO also suggests that employees undertake a ‘Super Health Check ’ annually. By checking these five (5) details are correct it can ensure that your super information is current:

Are your contact details up to date?
When was your last employer contribution, and what is your balance?
Do a lost or unclaimed super check (check here)
Should you have multiple super accounts, it may be worthwhile to consolidate, as sometimes you are paying unnecessary fees for multiple super accounts.
Do you have a nominated beneficiary for your super?

If you require assistance with your super guarantee practices at your workplace, please get in touch. At Profit First Accounting we are experts in compliance so you don’t have to be. We can also assist you in implementing processes to ensure that your cash flow remains positive.