Currently the ATO is focusing on a super compliance program that is looking at super paid by employers.  If you follow the rules listed below you should avoid any problems:

1.       For employees aged 18-69 years old inclusive, the rule is you are required to pay super if the employee’s monthly gross wages is greater than $450.
2.       For employees under 18 of age, the rule is you are required to pay super if the employee works greater than 30 hours and earns greater than $450 for the month.

So the next question you ask is how much do I need to pay?

The answer is simple, you pay 9% of ordinary time earnings to a complying superannuation fund. In actual fact in most cases this is 9% of gross wages.

Final question you should be asking is, what time frame do I have to pay?

The time frame you have to pay the super to a complying fund is 28 days at the end of the quarters, ending 30 March, 30 June, 30 September and 31 December.

All the above seems pretty mechanical and no problems should be encountered. But what happens if you are a day late and the ATO comes across this fact?

 The ATO can impose a super guarantee charge, which in effect means you pay 9% to the ATO on top of the 9% you already paid to the employee’s super fund. This means you have paid pay super twice with no tax deduction for either payment.

In effect to avoid any nasty penalties from the ATO it is critical all super is paid for employees on time. The moral of the story is that it is critical to be organised with super payments and pay them on time.

If you would like to learn more about paying your employee superannuation, click here to contact Troy Marchant from our office.