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Image of a piggy bank with the heading 'Amnesty for businesses with unpaid super'.

Amnesty for businesses with unpaid superannuation

The super guarantee amnesty is now available. Applications close 7 September 2020. If you have outstanding super, you can settle without paying super guarantee charge fees or penalties. To be eligible: The unpaid super must relate to a quarter between 1 July 1992 and 31 March 2018; You must not have previously told the Australian Tax Office (ATO) about the unpaid super, or be under review by them for the unpaid super; You must apply to the ATO under the amnesty by using the correct form.

Small business owners have been given until 7 September 2020 to get up to date with unpaid super and avoid penalties, under the super guarantee amnesty introduced by government on 6 March 2020.

The amnesty allows employers to disclose and pay previously unpaid super guarantee charges (SCG), including interest, that they owe their employees from 1 July 1992 to 31 March 2018, without incurring the administration charges or penalties that usually apply to late payments.

In addition, catch up payments made to the ATO after 24 May 2018 and before 11:59 PM on 7 September 2020 will be tax deductible.

The amnesty has been introduced as part of the Government’s package of reforms to protect workers’ superannuation entitlements. The ATO estimates about $2.85 billion in SG payments went unpaid in 2014-2015.

How to apply

To take advantage of the amnesty, businesses who come forward after 6 March 2020 need to apply for the amnesty. Employers who have already disclosed unpaid SGC to the ATO between 24 May 2018 and 6 March 2020 don’t need to apply or lodge again.

If the ATO reviews or audits identify employers with unpaid SG for their employees, they will need to pay staff their outstanding superannuation in full, plus interest calculated at 10 per cent a year, an administration charge of $20 per employee per quarter, and a penalty of between 50 and 200 per cent of the SGC. 

Under the amnesty, businesses are required to calculate the SG charge on salary and wages, not ordinary time earnings, and must pay the nominal interest component calculated at 10 per cent per annum.

Tip: use the ATO’s superannuation guarantee charge statement and calculator tool to calculate your SGC amount and prepare your SGC statement.

More information

Find out more on the superannuation guarantee amnesty.

If you have any questions on handling superannuation for your business, speak to your accountant or contact our free small business advisory service on 133 140.

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