WARNING: The ATO is increasing the data matching activity on the timing of Superannuation Guarantee payments.

As you would be aware, Superannuation Guarantee payments are due by the 28th day of the month following the end of each quarter.  This means that the Superannuation Fund must receive the contributions to their bank account by that date to satisfy the requirements.

The ATO now has direct access to the timing of receipt of these payments from each superannuation fund and are matching that to your Single Touch Payroll reports to find unpaid or late contributions.

If the funds are not received by the superfund’s bank account by the due date the following will occur:

1) You will be required to lodge a superannuation guarantee charge form which is made up of:

  • The unpaid or late paid superannuation calculated on ALL earnings including overtime, not the usual Ordinary Time Earnings;
  • Interest on these amounts calculated at 10%, payable from the start of the quarter that the super relates, to the date the form is lodged;
  • An administration fee of $20 per employee per quarter; and
  • Further penalties of up to 200% may also be imposed in extreme circumstances.

2)  The superannuation contributions and additional charges noted above will NOT be allowed as a tax deduction.

Please note that these charges can be implemented even if the contributions are one day late!

Tip: Ensure you pay your contributions early enough to clear the bank before the due date.

We have seen a significant increase in audit activity in this area.  The time required to provide information and liaise with the ATO can be considerable (even if you have done everything correctly).  For this reason, we offer tax audit insurance that is designed to cover the cost of professional fees in the event of an audit.  If you would like to know more information, please contact our office.

If you have any questions or would like to discuss your superannuation obligations, please contact your Cooper Reeves adviser.