Super Quick Guide for Business

(c) Commonwealth of Australia
Source: Australian Taxation Office

Are you an employer for super purposes?

You’re an employer if you employ a person under a verbal or written employment contract on a:

  • full-time
  • part-time, or
  • casual basis.

You may also be considered an employer for super purposes if you make payments to a person under a contract for labour.

 

Do you have to pay super for your employees?

Generally, you have to pay super for your employees if they:

  • are between 18 and 69 years of age
  • are paid $450 (before tax) or more in a calendar month, and
  • work full-time, part-time or on a casual basis.

Are you self-employed?

If you are self-employed, you don’t have to make super contributions to a super fund for yourself. However, you may wish to consider super as a way of saving for your retirement. Most self-employed people can claim a full deduction for contributions they make to their super until age 75.

 

Do you have to pay super for contractors?

If you pay your contractors under a contract that is wholly or principally for labour, you have to make super contributions for them, even if they quote an Australian business number (ABN).

 

When do you pay super contributions?

When a cut-off date for payment falls on a Saturday, Sunday or public holiday, you can make your payment on the next working day after the cut-off date.

 

How much super do you pay?

You must pay a minimum of 9% of each employee’s earnings base. For most employees, their earnings base is their ordinary time earnings. This usually means the amount they earn for their ordinary hours of work.

 

Can you claim a tax deduction?

Generally, super contributions are tax deductible in the financial year you pay them. You cannot claim a tax deduction for the super guarantee charge. This is the penalty imposed if you fail to meet your super obligations.

 

Where do you pay super contributions?

You must pay contributions into a complying super fund or retirement savings account. Your employees may be able to choose the super fund you pay their super contributions into.

 

Do you need to offer your employees a choice of super fund?

You must provide a Standard choice form (NAT 13080) to new employees who are eligible to choose a super fund within 28 days of the day they start working for you.

Once an employee chooses a super fund, you have two months to arrange to pay contributions into that fund.

 

What records must you keep?

You must keep records that show:

  • the amount of super you paid for each employee
  • how you calculated the level of super you paid, and
  • that you have offered your eligible employees a choice of super fund.

What if you don’t meet your super obligations?

If you don’t meet your super obligations, you will incur a super guarantee charge. You must pay this charge to us if you don’t pay:

  • enough super contributions (at least 9%) for each eligible employee
  • super contributions by the cut-off date for payment, or
  • super to each employees’ chosen super fund.

If you don’t meet your obligations, you will have to lodge a Superannuation guarantee charge statement – quarterly (NAT 9599) with us by the due dates listed below.

You cannot claim a tax deduction for the super guarantee charge.

 

This information is for guidance only and is not intended as specific advice to any reader. Professional advice should be obtained before acting on any information contained herein. The publisher accepts no responsibility for loss occasioned to any person or organisation as a result of action or the refrain of action as a consequence of the contents of this publication.