Your employer obligations

Employers in Australia are required to comply with the provisions of the Superannuation Guarantee (Administration) Act 1992 (SG). The Act requires Employers to pay 9.25% of Ordinary Time Earnings (OTE) into a complying superannuation fund.

From 1 July 2014 this increases to 9.5%.

There are a number of circumstances when you do not have to pay super for employees. Please visit the ATO website for further details. Some examples are employees who:

  • Earn less than $450 per calendar month
  • Are under age 18 and working less than 30 hours per week

Employers need to pay super for employees who receive a superannuation pension or annuity while they are still working.

Ordinary Time Earnings

All real estate employers are required to pay SG contributions based on ‘Ordinary Time Earnings.’

Ordinary Time Earnings are an employee’s earnings in relation to ordinary hours of work (including over-award payments, bonuses, commission, shift allowances and paid leave.)

For a more detailed explanation of ordinary time earnings and a checklist for salary and wages and ordinary time earnings, refer to the ATO site.

SG Contribution Deadlines

SG payments for eligible employees are required to be received by a complying super fund by cut-off dates. Each quarter is detailed below:

Quarter

Date Banked

Q1 1 July to 30 September

28 October

Q2 1 October to 31 December

28 January

Q3 1 January to 31 March

28 April

Q4 1 April to 30 June

28 July

Where the cut-off date falls on a weekend or public holiday, payment may be made on the next working day after the cut-off date.

Late payments will result in loss of tax deduction for the payment and other potential penalties.

Maximum Superannuation Contribution Base

There is a maximum limit on the amount of super support you are required to provide for your employees. This amount is indexed each year.

In 2014/15 employers are required to pay superannuation guarantee contributions on earnings up to $49,430 per quarter.

This means that if employees earn more than this figure in a financial quarter you are not obligated to pay super on their excess earnings.

Note: Employers may be obligated to contribute above these limits under any industrial awards or workplace agreements in place.

If you have questions about how this applies to you please contact us.

Contribution Limits

There are limits to how much a person can contribute to super each year. Different limits apply to concessional and non-concessional contributions.

What if contribution limits are exceeded?

If the contribution limits are exceeded, an additional tax of 30% (plus the Medicare levy) will be payable on top of the standard 15% tax rate on any contributions that exceed the limit. The additional tax payable will be assessed by the Australian Tax Office and payable by the Fund member. Members can ask REI Super to pay the additional tax from their account. Below is a summary of when contributions can be made according to age.

 Age

65-69

70-74

75+

9.5%** SG Contributions

Yes

Yes

Yes

Award Employer Contributions

Yes

Yes

Yes

Voluntary Employer Contributions

Yes*

Yes*

No

Member (after tax) Contributions

Yes*

Yes*

No

Salary sacrifice (pre-tax Member) Contributions

Yes*

Yes*

No

* If gainfully employed at least 40 hours in a period of not more than 30 consecutive days during the same financial year in which the contributions are made.

**9.5% from 1 July 2014