The Government’s Super Guarantee Amnesty Legislation has received royal assent as of 6 March 2020.

The government has estimated that at least 14,000 employers have not met their superannuation guarantee obligations dating as far back as 1 July 1992. As a way to encourage these employers to meet their obligations, the government has introduced Superannuation Guarantee Amnesty Legislation.

Under superannuation laws, for an employer to receive a tax deduction for superannuation accrued on staff wages, the superannuation needs to be paid on time (i.e 28 days after the end of each financial quarter these quarters being March, June, September & December). If payments are not made on time, the payments are treated as non-deductible.

The Government’s Super Guarantee (SG) amnesty will allow employers to self-correct their superannuation guarantee underpayments. Importantly, employers will be able to claim a tax deduction for payments made for underpayment of their obligations. The Bill strictly covers the period between 1 July 1992 and 31 March 2018 where underpayment has taken place. Any underpayments after 1 April 2018 aren’t covered under this amnesty.

Note that you cannot claim under the amnesty if you have previously disclosed this information to the ATO before 24 May 2018.  To qualify for the amnesty, employers will need to submit the appropriate approved forms and must pay an employee’s full SG entitlement. In addition to this, the following amounts will also be payable:

  • General Interest Charges
  • The nominal interest of 10%

Employers who have an existing SG charge assessment for the quarter will be able to pay direct to the employee’s superannuation fund otherwise they will need to pay direct to the ATO. Employers who are not able to make payment in full are able to negotiate a payment arrangement with the ATO.

The amnesty period for submissions lasts from 1 April 2018 and extends up to 7 September 2020.

Employers who do not take advantage of the amnesty will face significantly higher penalties when they are caught – a minimum 100% penalty on top of the SG shortfall.

If you are concerned that you may not have met your superannuation obligations during this period or want to discuss your individual circumstance, please get in touch.