Lodging the superannuation guarantee

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Most of your employees will be eligible to receive the superannuation guarantee, which is 9% of their earnings, and is in addition to salary. It is compulsory, and the legislation requires you to:

• pay super for your eligible employees
• contribute to the correct super funds, and
• pay contributions by the cut off date each quarter.

(Here is a handy online tool to check the eligibility of staff, and see this superannuation article for more details on how much you have to pay.)

It's important to pay the correct amount of super by the cut-off date each quarter to avoid paying the superannuation guarantee charge to the Tax Office. These dates are:

Quarter	Quarterly payment cut-off date
Quarter 1 1 July - 30 September	28 October
Quarter 2 1 October - 31 December	28 January
Quarter 3 1 January - 31 March	28 April
Quarter 4 1 April - 30 June	28 July

If the quarterly cut-off date falls on a weekend or public holiday, the payment is due by the next working day. You can choose to make super payments more regularly than quarterly (for example fortnightly or monthly) as long as the total amount you owe each quarter is paid by the quarterly cut-off dates.

You can claim a full tax deduction for super payments you make for employees under the age of 75. Super payments are tax deductible in the financial year you pay them.

A new employee has the right to choose which superannuation fund they want their contributions to be paid into, so you need to supply them with a 'standard choice' form within 28 days of them starting (you can download the form here). After that, you have two months to start paying their contribution to the employee's chosen super fund.

If no choice is made, you can nominate a fund on their behalf. The important thing is to start paying the 9% on your employee's behalf into a complying fund that meets minimum insurance requirements. It does not have to be the same fund for every employee, but there can only be one fund per employee.

Some employers have undertaken, through worker agreements or awards, to report super contributions to staff on their payslips, but there is no tax law requirement for you to do so. You must however keep records of super guarantee transactions that the Tax Office can access if it asks, which should include details of how you ascertained how much to pay, evidence of offering choice of fund, and records of payments made. Details of any super guarantee charges you have been liable for also need to be kept.

Not meeting the choice-of-fund obligations can also see you hit with the superannuation guarantee charge, as will not meeting deadlines for payments, or simply not paying at all. Superannuation contributions are tax deductible to your business, but any super guarantee charges imposed on you are not.

The super guarantee charge is made up of three parts:

• the super guarantee shortfall
• nominal interest amount (10% a year)
• an administration fee ($20 per employee per quarter).

If a payment is made late, an employer must lodge a 'superannuation guarantee charge statement' (you can download one here) and pay a super guarantee charge. You are still liable for the quarterly contribution, so will have to pay that amount plus the interest and fee.

Some relief from the super guarantee charge is available. Called the 'superannuation guarantee late payment offset' (more on this here), this allows you to offset the shortfall component and the interest once you make up the late payment (but you can't offset the fee or any other penalties incurred). The catch-up payment needs to be made before the due date for lodging the super guarantee charge statement in order to qualify for the offset.

Reviewed August 1, 2012

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