Superannuation Guarantee Obligations: Don’t Get Caught Out by the ATO!
Increased ATO Activity with Employers’ Superannuation Guarantee Obligations
Over the last couple of years, the ATO has introduced multiple new systems to change the way in which employers meet superannuation guarantee obligations for their employees. The two most recent significant changes regarding superannuation guarantees are:
Here is a quick summary on what both systems are:
SuperStream is the way you must pay employee superannuation guarantee contributions to super funds. With SuperStream, money and data are sent electronically in a standard format. This data is generally sent by your accounting system, small business super clearing house or external payroll provider, if one is used. SuperStream transmits money and information consistently across the superannuation system – between employers, funds, service providers and the ATO. The data is linked to the payment by a unique payment reference number.
Single Touch Payroll (STP)
Single Touch Payroll is a new way of reporting tax and superannuation information to the ATO. With STP you report employees’ payroll information – such as salaries and wages, pay as you go (PAYG) withholding and superannuation – to the ATO each time you pay your employees through STP-enabled software. Again, this is done via your accounting software or an external payroll provider. For more information on STP you can find our detailed article here.
Real-time Information for the ATO
As you can see from the most recent changes detailed above, the introduction of both SuperStream and STP has given the ATO real-time information on the superannuation obligations that employers have to their employees. This is information that was previously not available to the ATO in real-time and also not easy for them to obtain, prior to the introduction of these systems. Previously, they relied on employers voluntarily reporting late super via Super Guarantee Charge forms or by conducting randomised audits.
Increased ATO Activity Audits
So, what is the ATO doing with the new powers and information that is available to them? It was reported late last year that the ATO, through the information available to them via SuperStream and STP, had marked thousands of employers as superannuation “late-payers.” A superannuation guarantee charge would be enforced by the ATO for employers who did not pay superannuation guarantee on time. The ATO estimated that more then 2,500 employees would receive late superannuation contributions from their employer.
This was just the first round of compliance activity conducted by the ATO since the introduction of STP. We expect that as the ATO learn more about the best way to utilise this new information that is being reported to them, that this compliance activity will only increase.
These new systems and powers that the ATO have are not going anywhere, and if anything, they will only increase over time. The ATO will ultimately be given more oversight on how you comply with your employees obligations.
What Can You Do to Meet Superannuation Guarantee Obligations?
- Ensure that you are compliant with both SuperStream and STP. Complying with these is now law and not optional.
- Make sure that your payroll systems are calculating your employees obligations correctly.
- Superannuation payments for your employees are due 28 days after the end of each quarter. Make sure these are paid and reported on time.
*If you are not already receiving our quarterly reminders of the superannuation guarantee deadlines please email us at [email protected] and request to be placed on the SG Deadlines mailing list. You will be emailed a reminder before each quarterly due date for your superannuation guarantee deadline.
If you have any questions regarding superannuation guarantees, SuperStream or STP, your trusted Allan Hall advisor would be more then happy to assist you. Please contact us today!