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Superannuation Guarantee (SG) Amnesty 2020

Due to changes where superfunds and employers are required to report more frequently, the ATO now has access to a much higher level of data visibility. As a result, they are now conducting reviews and audits to identify employers who are not paying their employees Superannuation Guarantee (SG).

It is your legal obligation as an employer to pay Superannuation Guarantee Contributions for all eligible employees by the ATO stipulated quarterly dates:

• Quarter 1 – October 28
• Quarter 2 – January 28
• Quarter 3 – April 28
• Quarter 4 – July 28

However, the government has recently introduced a Superannuation Guarantee (SG) Amnesty. This amnesty allows employers to disclose and pay previously unpaid super (including nominal interest), that they owe their employees, for quarter(s) starting from 1 July 1992 to 31 March 2018, without incurring the administration component ($20 per employee per quarter) or Part 7 penalty (ATO, 2020). In addition, super payments made to the ATO after 24 May 2018 and before 11:59 PM 7 September 2020 will be tax deductible.

Therefore, if you missed the payment dates as mentioned above, you are required to fill in an ATO Superannuation Guarantee Charge Statement.  This means the unpaid superannuation will be paid to the ATO, who will then distribute the payment to the employees.

Employers who have already disclosed unpaid SGC to the ATO between 24 May 2018 and 6 March 2020 don’t need to apply or lodge again. Employers who come forward from 6 March 2020 need to apply for the amnesty.

If the ATO identifies non-compliant employers before they come forward, they will not be eligible for the benefits of the amnesty. The penalties are also significant:

• SG shortfall
• Nominal interest (10% calculated daily)
• Administration component ($20 per employee per quarter)
• Part 7 penalty (up to 200% of the SGC).

In addition, payments of the SGC won’t be tax deductible for your business.

As registered BAS Agents, we can prepare the calculations and lodge the form with the ATO for you. Due to the effects of COVID-19, the ATO are also willing to work with clients to establish a payment plan which could include:

• flexible payment terms and amounts which adjust if your circumstances change
• the ability to extend the payment plan to beyond 7 September 2020, the end of the amnesty period. However, only payments made by 7 September 2020 will be deductible.

Paying super is an important part of being an employer and the penalties for non-compliance are significant. If you have any questions or are unsure of what you need to do, don’t hesitate to book a consultation with one of our bookkeepers below, or give us a call.

Our Bookkeepers

Justine Day: Southern Highlands / Bowral Bookkeeper
Amanda Graham: Southern Highlands / Bowral Bookkeeper
Petra Austing: Southern Highlands / Bowral Bookkeeper
Karin Evans: Gold Coast Bookkeeper
Pru Hall: Wollongong Bookkeeper
Jackie Short: Canberra Bookkeeper