by Luke Quinnell
The ATO highlights that they “take a firm approach on the non-payment of super”, and this applies even if you are the only employee of your business! Here’s how to stay out of the ATO’s crosshairs.
We have noticed a substantial increase in ATO compliance action around superannuation guarantee payments. With the increased information available to the ATO via Single Touch Payroll (STP) reporting, ATO compliance is capturing many more incidents of noncompliance.
The key point from the ATO is that employers need to pay their super guarantee contributions in full and on time.
Super Guarantee Due Dates
From 1 July 2024, super guarantee contributions are now 11.5% of an employee’s ordinary times earnings. These payments need to be paid at least quarterly and are due 28 days after the end of each quarter. For all wages paid and super accrued within the following periods, these are the due dates for payment:
- 1 July to 30 September – payment due 28 October
- 1 October to 31 December – payment due 28 January
- 1 January to 31 March – payment due 28 April
- 1 April to 30 June – payment due 28 July
These due dates will change from 1 July 2026 as super guarantee contributions will be required to be paid at the same time as an employee’s salary/wage payment.
Consequences Of Noncompliance
One of the most common reasons for ATO compliance action is late payment. Even when the correct amount of super was paid, if it was not paid by the due date the employer will be required to pay a super guarantee charge debt.
We have even seen cases where the only employee of the business is the business owner and the ATO has still undertaken compliance action because of late payment. This goes against conventional wisdom that an ATO compliance action in this area was a result of an employee contacting the ATO regarding their unpaid or late paid super.
When the ATO has concerns that the correct amount of super has not been paid or paid on time, they will require you (the employer) to pay a super guarantee charge to compensate your employees for the underpayment or late payment. This includes interest and administrative charges, but it doesn’t end there.
In general, payment of superannuation on behalf of employees is a tax-deductible expense. However, if the payment is made late, it is no longer allowed as a tax deduction!
Also, if a super guarantee charge payment is required, you will need to pay super on any wage item that would not generally incur a super liability, such as overtime.
How We Can Help
In summary it is imperative that employers pay their employees superannuation payments in full and on time. Non-compliance in this area will likely be discovered by the ATO and there will be substantial costs to you as the employer.
If you are concerned with how you are managing your superannuation payments for your employees, or with any recent payments you have made, please contact our office below or call 02 4969 6600 and we can assist you in ensuring you meet all of your requirements as an employer.
