The introduction of the SGC required employers to pay to employees selected superannuation fund an amount equal to 3% of assessable wages.
This has subsequently been increased in stages to its current level of 9.5%
Currently, the regulations require that employers lodge and pay their superannuation liabilities on a quarterly basis. It is our view that the ATO will seek to either alter this to monthly or to lodging at the time each payroll is processed.
From our perspective, we currently recommend to our clients that they pay their liabilities on a monthly basis.
From the bookkeeper’s perspective, it is important to understand what wages are assessable and what is included in the SG. These are referred to as ordinary time earnings and are as follows:
Wages and salaries not included in the SGC are as follows:
As can be seen, this legislation can be quite difficult to interpret to ensure correct compliance.
Lodgement dates for SGC are as follows:
Quarter Period Due Date
1 1 July to 30 September 28 October
2 1 October to 31 December 28 January
3 1 January to 31 March 28 April
4 1 April to 30 June 28 July
Once again the role of the bookkeeper becomes important here as failure to lodge on time results in fines been levied, the interest charged at a rate of 10% on overdue amounts, and an administration fee of $20 per employee per quarter.
In addition, where payment or return is lodged late it is no longer able to be deducted as an expense so effectively becomes taxable income and is taxed at the company tax rate.
Lastly and as indicated above with the introduction of STP and the ATO data matching capabilities all employers are now being constantly monitored for compliance with SGC. It is therefore incumbent on the bookkeeper to ensure that the correct charges are being paid and that lodgements and payments are made in accordance with the above schedule.