There is currently a superannuation guarantee (SG) amnesty which allows employers to disclose and pay previously unpaid employee superannuation guarantee for quarters between 1 July 1992 to 31 March 2018.
Disclosures made under the amnesty will not incur the administration charge ($20 per employee per quarter) or the Part 7 penalty.
Also, payments made under the amnesty and before 7 September 2020 will be tax deductible.
Employers seeking to participate in the superannuation amnesty need to apply by 7 September 2020.
To be eligible for the amnesty, you must meet the following criteria:
- you have not been advised that the ATO is examining or is intending to examine your SG obligations for the quarter(s) your disclosure relates to;
- you have disclosed an SG shortfall for an employee you haven’t already disclosed to the ATO;
- you disclose a shortfall for the quarter(s) starting from 1 July 1992 to 31 March 2018;
- you lodge your completed SG amnesty form with the ATO so it is received no later than 7 September 2020
You will also need to pay the amount owing to the ATO (or set up a payment plan) after lodging the SG amnesty form.
Benefits of the amnesty
If you qualify for the amnesty, you:
- Will be able to claim a tax deduction for SG amounts covered by the amnesty that are paid by 7 September 2020;
- Won’t be required to pay the administration component ($20 per employee per quarter)
- Won’t have a Part 7 Penalty applied.
Failure to disclose unpaid super
The ATO will continue to conduct audits of employers not paying their employees’ superannuation. If these employers are identified (before they voluntarily disclose their liability), they will not be eligible for the benefits of the amnesty. They will be required to pay:
- The superannuation shortfall
- The nominal interest charge of 10%
- The administration charge ($20 per employee per quarter)
- The Part 7 penalty (up to 200% of the superannuation guarantee charge)
What should affected employers do?
You need to act immediately to determine whether you have underpaid your employees’ superannuation for any previous quarter.
For unpaid quarters within the amnesty period, you apply for the amnesty by lodging an approved SG amnesty form.
If you are eligible, you will receive written notification from the ATO within 14 days of lodging the amnesty form.
In order to claim a tax deduction for amnesty-related payments, you must make the relevant payments by 7 September 2020.
Free ATO Online Course – employer SG obligation
The ATO also have a free online course designed to educate employers about their superannuation guarantee responsibilities for their employees. You can access the course here.
If you would like to discuss how to apply for the amnesty, please call us on (07) 56656469.
DISCLAIMER: The information in this article is general in nature and is not a substitute for professional advice. Accordingly, neither TJN Accountants nor any member or employee of TJN Accountants accepts any responsibility for any loss, however caused, as a result of reliance on this general information. We recommend that our formal advice be sought before acting in any of the areas. The article is issued as a helpful guide to clients and for their private information. Therefore it should be regarded as confidential and not be made available to any person without our consent,
Jeanette has over 20 years experience as an accountant in public practice. She is a Chartered Accountant, registered tax agent and accredited SMSF Association advisor. When she is not helping business owners grow their empires, you will likely find her out running on the trails or lifting weights in her local CrossFit gym. Book in to see Jeanette today.