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September 20, 2021

Are you meeting your super guarantee obligations?

Are you meeting your super guarantee obligations

As an employer, you have an obligation to contribute superannuation on behalf of your employees, but do you know that penalties are imposed if ever you fail to make contributions?

If the penalties for non-compliance are any guide, super guarantee payments are the obligation employers should prioritise above all others.

If you’re an employer, you’re required to pay 10% of your employees’ ordinary time earnings into their chosen superannuation fund.

These contributions must be paid by the quarterly cut-off date.

If you fail to do this, you have to:

  • report to the ATO by lodging a Superannuation guarantee charge statement – quarterly.
  • pay the super guarantee charge, which comprises:
    • the super guarantee shortfall
    • nominal interest of 10% per annum (which accrues from the start of the relevant quarter)
    • an administration fee of $20 per employee, per quarter.

“If you’ve got tax debts,” says Modoras Accounting Manager Annette Harden, “the one you should pay first is the super guarantee charge.

“That because, unlike other tax debts, you can’t defer it or pay it back in interest-free instalments as part of a payment plan.”

More downsides

Not only do you have extra paperwork and penalties to contend with, you also end up paying more in tax.

That’s because, unlike super guarantee contributions, payment of a super guarantee shortfall is not tax-deductible.

The downsides don’t end there: If you’re a director of a company that doesn’t meet its super guarantee charge obligations, the ATO can recover those amounts from you personally.

“The ATO is extremely serious about employers meeting their super guarantee requirements,” says Annette.

“It’s vital employers offer their employees a choice of super fund, pay them the right amount of super, and pay it on time.”

As for the payment method, Annette says all businesses should be SuperStream compliant –able to send the super contributions and data electronically to their employees’ funds.

These transfers are often done via a super clearing house, which can distribute the contributions in bulk on your behalf.

Get expert advice

Is your business struggling to meet its super guarantee obligations?

Modoras can help you:

  • set up your payroll so it’s calculating the super guarantee payments correctly
    •  collect data for and prepare the Superannuation guarantee charge statement – quarterly (if you fall behind in your payments).

Contact us for a complimentary consultation at or 1300 888 803. We’ll take care of you.


IMPORTANT INFORMATION: This blog has been prepared by Modoras Accounting (QLD) Pty. Ltd. ABN 81 601 145 215. The information and opinions contained in this blog is general information only and is not intended to represent specific personal advice (Accounting, taxation, financial, insurance or credit). No individuals’ personal circumstances have been taken into consideration for the preparation of this material. The information and opinions herein do not constitute any recommendation to purchase, sell or hold any particular financial product. Modoras Accounting (QLD) Pty. Ltd. recommends that no financial product or financial service be acquired or disposed of or financial strategy adopted without you first obtaining professional personal financial advice suitable and appropriate to your own personal needs, objectives, goals and circumstances. Information, forecasts and opinions contained in this blog can change without notice. Modoras Accounting (QLD) Pty. Ltd. does not guarantee the accuracy of the information at any particular time. Although care has been exercised in compiling the information contained within, Modoras Accounting (QLD) Pty. Ltd. does not warrant that the articles within are free from errors, inaccuracies or omissions. To the extent permissible by law, neither Modoras Accounting (QLD) Pty. Ltd. nor its employees, representatives or agents (including associated and affiliated companies) accept liability for loss or damages incurred as a result of a person acting in reliance of this publication. Liability limited by a scheme approved under Professional Standards Legislation.

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