Amongst the many office tasks you have on your list, paying your employees’ Super Guarantee (SG) on time should not be overlooked. There are fees and interest charges applicable to those who do not comply with the due dates.

We are seeing an increase in compliance activity in this area, with the Tax Office using the real-time payroll data it receives through the Single Touch Payroll system to identity and action late payment by employers.

For more information on this topic, read below.

As an employer, you must pay your employees their SG within 28 days of the end of each quarter. If you fail to pay the correct super amount on time, then you will need to pay the Super Guarantee Charge (SGC) to the Australian Taxation Office (ATO). 

To understand the difference between Super Guarantee and Super Guarantee Charge, you should first understand each term separately:

Super Guarantee (SG) – The compulsory amount an employer needs to pay into their employees’ chosen super fund.

The Super Guarantee is not deemed as paid for tax purposes until the funds are received by the employees’ superannuation fund. As such, we advise that payment should be made no later than the 21st day after the end of each quarter, to allow sufficient time for the payment to be processed through the superannuation clearing houses used by the Tax Office and the major accounting software providers. 

Super Guarantee Charge (SGC) – The penalty imposed by the ATO if the correct super is not paid on time.

The SGC is not tax-deductible and it is calculated on an employee’s total salary and wages (including overtime, annual leave loading and some allowances). This means that in addition to the penalties you incur, you will not be able to claim super contributions or any other additional costs as a tax deduction. 

The SGC includes:

• Unpaid super/ super paid after the due date.
• Interest of 10% accrued on the above amount.
• Administration fee of $20 per employee, per quarter.
• Choice Shortfall, that is payable when the employer fails to meet their choice of fund obligations (by failing to give the employee the opportunity to choose a super fund). The Choice Shortfall goes up to $500 per employee, per notice period.

Super Due Dates – Below are the due dates for each quarter.