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Unpaid super - Relief for Australian Businesses

By Claire Burke-Atcheson

Sunsuper helps more than 130,000 businesses1 manage their super obligations, while at the same time providing a range of services to help businesses support their people’s financial wellbeing and enhance their employee value proposition.

However, we know that superannuation is only one part of a never-ending spectrum of tasks and activities needed to keep your business moving. All too often, hardworking small and medium business owners are stretched thin by clients who take forever to pay and as a result, some businesses aren’t always able to meet their super obligations when they’re due.

If cash flow is tight, then all aspects of the business are under pressure; from purchasing resources or stock and funding sales and marketing activities, to paying staff and maintaining compliance.

Please note, the SG Amnesty measure did not pass parliament and will be withdrawn once the election is called in 2019. It will then be up to the incoming government whether the bill will be reintroduced. We will provide an update in the event that this occurs

12 month Amnesty for unpaid super

If you have fallen behind or missed superannuation contributions, the Federal Government have proposed legislation providing relief in the form of a Superannuation Guarantee (SG) Amnesty that may help you get back on track.

Subject to the passage of legislation, the Australian Taxation Office (ATO) will provide a one-off opportunity for businesses to self-correct past super guarantee non-compliance without penalty. At the time of writing, the Labour Party has recommended opposing the bill2. The Labour Party have however proposed that if the legislation is passed that the SG Amnesty period will apply for 12 months from the date the bill is passed3

According to the proposed legislation, to be eligible for the Amnesty, employers must:

  • voluntarily disclose amounts of SG shortfall within the 12-month Amnesty period,
  • disclose amounts of SG shortfall that have not previously been disclosed, and
  • not be subject to an audit of your SG for the relevant periods.

Find out more information on the ATO website.

The potential good news for employers includes: 

  • the proposed Amnesty is eligible for any contributions missed between 1 July 1992 – 31 March 2018,
  • the administration component of the SGC is not payable (usually $20 per employee, per contribution period), and 
  • all catch-up payments made to superannuation funds during the SG Amnesty period will be tax deductible.

If you have large amounts of unpaid SG, then you could  potentially save thousands of dollars in penalties. 

The ATO have issued a stern warning4 that “Employers who are not up-to-date with their SG payment obligations to their employees and who don't come forward during the Amnesty may face higher penalties in the future.”

The ATO also confirmed, payment plans will be available to employers who are unable to pay the full SG shortfall amount directly to employees’ super fund(s). 

To learn more about accessing the Amnesty, visit the ATO website.

By Claire Burke-Atcheson, Manager of Digital Distribution, Sunsuper

  1. As at July 2018
  2. Treasury Laws Amendments (2018 Superannuation Measures No. 1) Bull 2018 [Provisions] – Parliament of Australia, 18 June 2018 
  3. Proposed amendments House of Representatives, Non-Government BOWEN, Chris, MP 
  4. Superannuation Guarantee Amnesty, Australian Government, 2018  

The views of the author and those who provided the responses to the comments  posted on the Knowledge Centre are not necessarily the views of the Sunsuper Board. While Sunsuper attempts to make a wide range of information available via the Knowledge Centre it may not cover all the options available to you. We’ve put this information together as general information only and as such it doesn’t take into account your personal financial objectives, situation or needs.  You should get professional advice before relying on this information. 

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