24th October 2019

    Author: Scott Vollmerhause

    You may have read in the news recently that the Australian Tax Office (ATO) has introduced new measures that give it greater visibility of payroll, tax and superannuation payments made by businesses.

    With the introduction of these changes (including Single Touch Payroll), late payments are more stringently monitored, and in addition, the ATO will also receive reports from superannuation funds that let them know when you make super payments to your employees’ chosen fund.

    Consequently, employers may receive penalties for late payments much sooner than they may have in the past.

    What does this mean for you?

    If a superannuation payment is made late, or not at all, businesses have an obligation to lodge a Superannuation Guarantee Charge (SGC) statement and pay the SGC to the ATO. It is now almost certain that the ATO will detect any late payments and enforce the lodgement of the SGC statement.

    The consequences of this could include:

    • Potential penalty of up to 100 per cent of the superannuation contribution;
    • 10 per cent interest on superannuation payments, backdated to the beginning of the quarter;
    • Loss of tax deductibility for the superannuation amount; and
    • $20 administration fee for each employee per quarter.
    • Super is payable on all salary and wages, not just on ordinary times earnings

    Indeed, the ATO recently announced that it is in the process of contacting 2,500 employers who paid some or all their employee superannuation late in the 2019 financial year, with a further 4,000 businesses to be contacted and reminded about key due dates for this financial year.

    Lodgement dates have never been more important:

    • 28th October 2019 (for the quarter ended 30 September 2019)
    • 28th January 2020 (for the quarter ended 31 December 2019)
    • 28th April 2020 (for the quarter ended 31 March 2020)
    • 28th July 2020 (for the quarter ended 30 June 2020)

    To prevent any complications or delays, we recommend that superannuation payments be initiated at least 5 business days prior to the due date. This gives things ample time to both clear through payroll systems and any superannuation clearing house you may be using.

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