As we look to the future, and incrementally increase the amount of superannuation paid to Australian workers, 1 July 2022 is the next date for further superannuation changes to come into effect.
As an employer it is important to make sure that you are aware of the coming changes and take any necessary action to ensure that you are meeting the superannuation guarantee obligations for your employees.
Super changes for 2022
From 1 July 2022, there are two important super guarantee changes coming into effect that will apply to your business.
The changes are:
- the rate of compulsory superannuation contributions is increasing from 10% to 10.5%
- the $450 per month eligibility threshold for when superannuation guarantee is paid is being removed
Employers need to know
These changes mean that from 1 July 2022, all super guarantee contributions that you make on behalf of your employees will need to be made at the new rate of 10.5%.
The removal of the $450 eligibility threshold means that all employees can be eligible for superannuation guarantee payments, regardless of how much they earn. As a result, you may have to pay superannuation guarantee for the first time for some, or all, of your employees.
What do employers need to do?
You should check to ensure that your payroll software is updated to correctly calculate your employees’ superannuation guarantee entitlement at a rate of 10.5% from 1 July 2022.
If the removal of the $450 threshold means that you will need to pay superannuation guarantee for one or more of your employees for the first time, you’ll need to give them a Standard Choice Form as soon as possible so that you can obtain the necessary information to make their payments.
If your employee does not provide you with a choice of super fund, review the Stapled Super Fund information on the ATO website for guidance on what you need to do next. A stapled super fund is an existing super account linked to an individual employee.
Important: know the changes and take action
As an employer, paying compulsory superannuation guarantee contributions for your employees is a legal obligation, not an optional extra. Not only is it important to ensure that you are making the payments in accordance with the payment deadlines and to the right fund, but that they are at the correct rate too. Severe penalties can apply to employers for failing to meet their superannuation obligations so it certainly pays to get it right.
We can help
If you are unsure about how the upcoming superannuation guarantee changes may affect your business, or for advice regarding other superannuation or payroll matters, contact the team of accountants and tax lawyers at The Quinn Group by calling us on +61 2 9223 9166 submitting an online enquiry form to schedule an appointment.