The ATO recently released an estimate of the superannuation guarantee (SG) gap for 2014/15 to be 5.2% or $2.85 billion.
What is Super Guarantee?
As an employer, your not-for-profit organisation must provide for the retirement of eligible employees. The minimum you must pay is called the super guarantee (SG):
- The SG rate is currently 9.5% of an employee’s ordinary time earnings.
- You pay into a complying super fund. Most employees are eligible to choose which fund you pay into.
- You must pay SG at least four times per year, by the quarterly due dates.
- Payments must be made using SuperStream, where contributions and associated information are sent electronically.
- If you don’t pay the SG on time, you may have to pay the super guarantee charge (SGC).
Organisations that are income tax exempt are not exempt from the superannuation guarantee legislation.
What is the SG Gap?
The SG gap is the difference between how much employers paid for employees SG obligations and how much they should have paid based on ATO estimates.
The ATO has supplied a range of strategies and activities to help educate and support employers in meeting their SG liability.
The super for employers section of the ATO website covers:
- working out if employers have to pay super
- how much to pay, and
- guidance on administration aspects, such as using a SuperStream compliant payment process.
The ATO has also developed a step by step guide for employees who have unpaid super that includes a tool to estimate eligible super contributions through to lodging an enquiry to report employers for unpaid amounts.
To check whether you’re meeting your SG obligations, feel free to contact our office and we’ll put you in touch with our Tax & Small Business expert, Mark Caldwell.