The ATO is taking a tougher stance on Superannuation Guarantee non-compliance and it could lead to errant employers facing harsh penalties – including a stint in prison.

New legislation to Director Penalty Notices introduced on April 1, 2019, gives the ATO powers to pursue criminal penalties for serious breaches when it comes to Superannuation Guarantee non-compliance, including potential jail time for individual employers or directors of a company (including a trustee company) that employs staff.

These amendments are one of several measures announced as part of the Government’s suite of reforms to strengthen compliance with Superannuation Guarantee obligations by employers.

For example, spouses or relatives who are appointed as directors of a small to medium-sized family businesses need to be aware of the new law and their financial obligations regarding superannuation Guarantee payments.  Therefore, it is crucial that clients fully understand the dangers involved with Superannuation Guarantee non-compliance when they take a position as either an individual employer, the director of a trustee company or a director of a company that is employing staff.


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The primary purpose of the Treasury Laws Amendment Act is to improve laws relating to superannuation to improve the integrity of the Superannuation Guarantee system and to improve pay as you go (PAYG) withholding compliance.

In recent presentation of the Australian Institute of Superannuation Trustees, the ATO says between July1, 2010, and June 30, 2018 it transferred over $2.6 billion to employees’ super funds on behalf of more than 1.8 million employees as a result of Superannuation Guarantee compliance activities.


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