After almost 2 years since being announced, yesterday the Superannuation Guarantee Amnesty passed both houses of parliament and is now only awaiting royal assent.
As employer you may be asking, what exactly does this mean for you?
Now that the legislation has passed this means that there are some significant concessions during the amnesty period enticing employers to voluntarily come forward and report under or late paid superannuation under the superannuation guarantee. The amnesty covers non-compliance with superannuation liabilities due right back from 1 July 1992 to when the amnesty was announced on 24 May 2018. From the date of royal assent, employers will have six months to report their underpayments.
Under the amnesty, employers will be able to claim tax deductions for any payments of the Superannuation Guarantee charge or payments made towards their superannuation guarantee charge. Employers will also avoid the ATO’s administration component of $20 per quarter per employee and no Part 7 penalty that may otherwise have applied.
These are significant concessions that could save employers hundreds, if not thousands of dollars, so it is strongly encouraged that all employers review their superannuation payment history and report any non-compliance under the amnesty, even if payments were 1 day late.
Once the amnesty period is over, or an audit begins before voluntarily disclosing, there are significantly higher penalties for those employers who haven’t taken advantage of the amnesty, should it have applied. That is, the ATO is limited in reducing the Part 7 penalty to 100% of the superannuation guarantee charge amount, essentially doubling (at a minimum) the amount payable whilst also not receiving a tax deduction for any of the amounts paid.
Should you think you have a reporting requirement, speak to your advisor.
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