The Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019 has now been passed. Finally. Not before there was a fair bit of confusion.
If you have not paid your employees super, now is the time to do it.
The super guarantee amnesty gives a once-off amnesty. It is designed to encourage employers to come forward and correct historical non-compliance for superannuation guarantee reporting (dating from 1 July 1992 to 31 March 2018). Worth noting is that an employer isn’t able to use the amnesty for superannuation guarantee shortfalls relating to the quarter starting on 1 April 2018 (or the subsequent quarters – so effectively the amnesty starts 24 May 2018 and will continue 6 months from royal assent on 24 February 2020 to end 24 August 2020).
Employers can claim tax deductions for payments of super guarantee charge or contributions that are made during the amnesty period for offset against the super guarantee charge. It also removes the administrative component and Part 7 penalty that usually arises where there is non-compliance with superannuation.
Penalties will be imposed on employers who fail to come forward during the amnesty period – by limiting the tax commissioner’s ability to remit penalties below 100% of the amount of the super guarantee charge.
“We encourage employers to check they don’t owe outstanding super — and if they do, to take advantage of this once-only opportunity to set things right before much tougher penalties apply.”
Assistant Minister for Superannuation, Financial Services and Financial Technology Jane Hume
If employers do not take advantage of the amnesty, they will now face significantly higher penalties when they are caught.
However, is this SG amnesty a trap?? See our previous article here and make up your mind…
This issue of superannuation not being remitted is supposed to be disappearing with single touch payroll. Businesses are expected to have this in place by now. If you haven’t remitted amounts of superannuation to the tax office, this could be a sign that your business is potentially insolvent. Unpaid superannuation can cause a director to become personally liable if they receive a directors penalty notice (or DPN) from the ATO. This might even result in personal bankruptcy. You must put in place a strategy to deal with any unpaid superannuation so that your business can avoid failure.
Don’t put off the inevitable – seek advice straight away. If you would like additional information and some strategic advice, please do not hesitate to get in touch confidentially by emailing firstname.lastname@example.org.