Super is money you pay for your workers to provide for their retirement.

Generally, if you pay an employee $450 or more before tax in a calendar month, you have to pay super on top of their wages.

How much to pay

The minimum super you must pay each quarter for each eligible employee is called the Super Guarantee (SG).

• The SG is currently 9.5% of an employee’s ordinary time earnings (OTE).
• You must pay SG at least four times a year, by the quarterly due dates.
• You must pay and report super electronically in a standard format, ensuring you meet Super Stream requirements.
• Your super payments must go to a complying super fund – most employees can choose their own fund.
• If you don’t pay the SG on time, you may have to pay the super guarantee charge.

OTE is usually the amount your employee earns for their ordinary hours of work. It includes things like commissions, shift loadings and allowances, but not overtime payments.

To work out what you must pay, multiply your employee’s OTE for the quarter by the SG rate (or the percentage you use if you’re paying super at a higher rate).

When to pay super

Quarter	Period	Payment due date
1	1 July – 30 September	28 October
2	1 October – 31 December	28 January
3	1 January – 31 March	28 April
4	1 April – 30 June	28 July

Claiming a tax deduction

You can claim a tax deduction for super payments you make for employees in the financial year you make them.

Contributions are considered paid when the super fund receives them. Missed payments may attract the super guarantee charge (SGC), which is not tax-deductible.

Example –

During the first quarter of the 2015–16 financial year (1 July – 30 September 2015) John’s ordinary time earnings were $10,000.

The super contribution John’s employer had to pay for John for this quarter was:

$10,000 x 9.50% = $950.00

To avoid the super guarantee charge, John’s employer must have contributed at least $950 to a complying super fund for John by 28 October 2015.

Ordinary hours

Your employee’s ordinary hours will be the normal hours they work, unless their hours are specified in an award or agreement.

If you can’t determine the normal hours of work (such as for casual workers), the actual hours the employee works will be their ordinary hours of work.

The Fair Work Act’s definition of ordinary hours for workers not under an award or agreement caps them at 38 hours. This definition does not override the super laws above.

Ordinary time earnings (OTE)

Ordinary time earnings are generally what your employees earn for their ordinary hours of work, including:

• over-award payments
• commissions
• shift loading
• allowances
• Bonuses.

Contact us to view various types of payments employees may receive, and whether those payments are OTE.

The Super Guarantee Charge (SGC)

If you don’t pay the minimum amount of super guarantee (SG) for your employee into the correct fund by the due date, you may have to pay the super guarantee charge (SGC).

The charge is made up of:

• SG shortfall amounts calculated on your employee’s salary or wages
• Interest on those amounts (currently 10%)
• An administration fee ($20 per employee, per quarter).

You report and rectify the missed payment by lodging an SGC statement by the due date and paying the SGC to ATO.

Payment dates for SGC

You must lodge your SGC statement and pay the charge by the due date.

Quarter	Period	Due date
1	1 July – 30 September	28 November
2	1 October – 31 December	28 February
3	1 January – 31 March	28 May
4	1 April – 30 June	28 August

Call us on 0449 952 855 to book an appointment for lodgment of your tax return. You can also get in touch with us by emailing us at info@expert-tax.com.au.

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