Super Guarantee (SG) paid on 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 specific cut-off dates each quarter, as is detailed below:
Q1 1 July to 30 September
Q2 1 October to 31 December
Q3 1 January to 31 March
Q4 1 April to 30 June
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 2017/18 employers are required to pay superannuation guarantee contributions on earnings up to $50,810 per quarter.
This means that if employees earn more than this figure in a financial quarter you are not required to pay super on their excess earnings.
Note: Employers may be required to contribute above these limits under any industrial awards or workplace agreements in place.
There are limits to how much an employee can contribute to super each year. Different limits apply to before and after tax 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.
Here is a summary of when contributions can be made according to age.
9.5%** SG Contributions
Award Employer Contributions
Voluntary Employer Contributions
Member (after tax) Contributions
Salary sacrifice (pre-tax Member) Contributions
* 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