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Superannuation Guarantee Amnesty

The Superannuation Guarantee Amnesty was introduced on 24 May 2018 by the Minister for Revenue and Financial Services in a bid to tackle non-payment of employee super.

The Amnesty provides a one-off opportunity for employers to self-correct any past super guarantee (SG) non-compliance without incurring a penalty. However, there is a lot of ambiguity around which employees are entitled to compulsory super payments.

Small business employers need to pay special attention to these particular areas:

Ordinary time earnings
An understanding of ordinary time earnings (OTE) is essential as it is used to calculate tan eligible employees minimum SG contributions. OTE is generally what your employees earn for their ordinary hours of work. It includes things like commissions, shift loadings and allowances, but not overtime payments. The SG is 9.5 per cent of an eligible employees ordinary time earnings (OTE).

If you make super contributions under an award, check that they are enough to satisfy both the award and the SG. Issues can occur where an agreement prevails over an award, no ordinary hours of work are stipulated, where an employee gets reimbursed, there is no award or agreements and where overtime is paid the same as ordinary hours.

Contractors
So you think you do not need to pay contractors super? Think again. Some contractors may be entitled to super.

The ATO also sees cases where employers classify employees as contractors, and consequently, forgo paying their super. If you are unsure of whether a worker is a contractor or employee, or if you unsure if your contractors are entitled to super, seek professional advice.

Posted on 27 July '18 by , under Super.

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What to consider when consolidating your super

The ATO reported that 45% of working Australians were not aware that they had multiple super accounts in 2016. Having multiple super accounts is particularly common for individuals who have had more than one job. If this is you, it is important to identify and manage your super accounts because having more than one can be costly as a result of account fees from multiple funds.To combat this, you may want to consolidate your super, which moves all your super into one account. Not only does this save on fees, but it also makes your super easier to manage and keep track of.

Before consolidating your super, it is important to do the following:

Research your funds' policy
Compare your active super accounts so you can make the right choice about which one you should close. Things to assess include:

  • Exit fees
  • Insurance policies
  • Investment options
  • Ongoing service fees
  • Performance of the funds

Check employer contributions
Changing funds may affect how much your employer contributes, as some employers contribute more to certain funds. Check your current accounts to see if changing funds will affect this. Once you have selected a super fund, regardless of whether you choose a new super fund or one of your existing ones, provide your employer with the details they need to pay super into your selected account.

Gather the relevant information
When consolidating your super, you will need to have the following details ready:

  • Your tax file number.
  • Proof of identity. This could include your driver's license, birth certificate or passport.
  • Your fund's superannuation product identification number (SPIN).
  • Your fund's unique superannuation identifier (USI).
  • Details of your previous fund.

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