A Superannuation Audit & Penalties – 10 tips to Minimise the Risk
October 13 – by Sue Warren
Avoid superannuation penalties, administration fees, and paperwork by following ADPs 10 super tips:
- Employer’s superannuation contribution increased from 9.25% to 9.5% in July 2014.
Have you calculated a minimum 9.5% super for all employees?
If not, you must;
a. update your employee’s super details now
b. calculate an additional 0.25% super for any ordinary time earnings they have been paid for the year
c. pay the outstanding amount into the employees’ super funds by no later than 28 October.
- Make sure you are calculating employees’ superannuation on all their ordinary time earnings. This is generally what your employees earn for their ordinary hours at work, including over-award payments, bonuses, commissions, shift-loadings and allowances that are not related to an expense.
- Ensure you have given all new employees a Standard choice form within 28 days of them commencing employment.
- Check that you have acted on an employee’s choice and are now sending their super contributions to their chosen fund.
- Are you using the correct Superannuation Standard Choice form?
The latest version includes additional information required for SuperStream – such as a unique superannuation identifier (USI) and electronic service address (ESA). Download the form at: www.ato.gov.au/Forms/Superannuation-(super)-standard-choice-form/.
- Check that you have forwarded all new employees’ tax file numbers to their super funds within the required timeframe.
- Make sure that your super contributions are paid appropriately.
Casual employees are entitled to super payments when they earn more than $450 in a month. This amount may differ depending on the awards – For some employees, the threshold may be $350 a month.
- If you apply the maximum super contribution base to your high income employees, ensure you have you paid the correct amount – For instance, you must pay $4,695.85 for the first $49,430 paid to them for the quarter.
- Have you had contractors invoice you for work done during the quarter?
Make sure the ATO does not classify them as an employee for super purposes. If in doubt visit: www.ato.gov.au/calculators-and-tools/employee-or-contractor/.
- Have you paid employees’ personal contributions to their super funds on a monthly basis?
While employer contributions can be paid quarterly, member after-tax contributions must be paid monthly.
Finally, if you pay super after the quarterly deadline, it can no longer be treated as a tax deduction to your business.