Your Small Business Specialists

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As a small business owner you will have superannuation obligations for your employees. There is a minimum earning cut-off (currently $450 per month) where most employees, full, part-time, casual or even contractors will need to have a superannuation contribution made of a percentage of their ordinary time earnings (currently 9%). The exceptions include employees under 18 years who worked less than 30 hours in a week and employees over 70 years of age.

Prior to the 1st July 2008 superannuation may have been paid on a different earnings basis such as that contained in an industrial award. However after 1st July 2008 the earnings base for most employees is their ordinary time earnings generally being what they earn for their ordinary hours of work. Payment can be made to an eligible superannuation fund or you can pay any late contributions to the ATO superannuation guarantee charge but you forego a tax deduction and may be charged additional interest and penalties.

Superannuation contributions are tax deductible in the year the payment is banked or available for banking by the superannuation fund. The superannuation guarantee legislation was brought in to ensure adequate income for Australians when they retire.

Employers must make superannuation guarantee contributions on behalf or their eligible employees at least quarterly (28th October, 28th January, 28th April and 28th July). The superannuation guarantee is self-assessed so records must be kept of superannuation contribution payments and that you have offered your eligible employees a choice of super fund.

FURTHER INFO: Guides on the ATO website are:-

Employer Obligation Checklist
Superannuation Guarantee Eligibility Decision tool
Employee/contractor decision tool
Choice of Superannuation Fund