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FAQs - Superannuation

What is the timing for contributing superannuation for deductibility purposes?

The time an employer contribution is made is important because the employer can only deduct a contribution "for the income year in which you made the contribution".

The timing of a contribution is not only significant for an employer's deduction entitlement, but may also affect:

  • When an employer's superannuation guarantee contribution is made
  • A member's entitlement to a tax deduction for a year
  • A member's liability to excess contributions tax
  • Eligibility for a government co-contribution in year, and
  • The inclusion of the contribution in a fund's assessable income for the year


The ATO view on when a contribution is made is that a superannuation contribution is made when the capital of the fund is increased. This may be when an amount is received, when ownership of an asset is obtained or when the fund otherwise obtains the benefit of an amount. In the ordinary case:

  • A contribution in cash is made when received by the fund
  • A contribution by EFT or internet banking is made when the amount is credited to the fund's bank account – this may occur sometime after the contributor has done what is necessary to effect the payment, and
  • A contribution by cheque is made when the cheque is received by the fund, unless it is subsequently dishonored
Last Updated on Monday, 02 September 2013 21:38

What are reportable employer superannuation contributions?

Reportable employer superannuation contributions are contributions made by an employer under a salary sacrifice arrangement or contributions for an employee above the minimum amount required by law.

A reportable employer superannuation contribution for an individual for an income year is an amount contributed:

  1. by an employer of the individual, or an associate of the employer, for the individual to a superannuation fund or RSA
  2. to the extent that the individual has the capacity, or might reasonably be expected to have capacity to influence:
    1. the size of the amount, and/or
    2. the way the amount is contributed so that their assessable income is reduced
Last Updated on Monday, 02 September 2013 21:38

What tax rate does my superfund pay when I contribute deductible super contributions?

In last year's Budget, the government announced that, with effect from 1 July 2012, the rate of tax that applies to the concessional contributions for people with income above $300,000 would be increased from 15 percent to 30 percent.

If your income is less than $300,000 or less, the tax rate is only 15%.

Last Updated on Monday, 02 September 2013 21:38

I am thinking of commencing business. In what circumstances do I need to pay employee superannuation under the Superannuation Guarantee Scheme?

The superannuation guarantee scheme is designed to encourage employers to provide a minimum level of superannuation support for employees.

Where an employer provides less than the required level of support, they will be liable to pay a non-deductible charge called the Superannuation Guarantee Charge (SGC).

An "employee" for superannuation guarantee purposes is anyone who is an employee at common law. Generally, the degree of control exercised by the "employer" over the "employee" and the degree to which the "employee's" services are an integral part of the "employer's" business will be significant whether an employer-employee relationship exists.

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Last Updated on Thursday, 22 August 2013 04:22

How is the required superannuation calculated?

Employer superannuation support under this scheme is measured in terms of a percentage of an employee's notional earnings base/salary and wages. For the current year, the percentage of that base that must be contributed is 9.25%.

The government has announced changes that will gradually increase the superannuation guarantee rate (charge percentage) from 9% to 12% between the 2013-14 and 2019-20 years. We will publish updated guidance if these announced changes become law, given that the coalition have flagged the deferral of these increases by 2 years.

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Last Updated on Monday, 02 September 2013 21:40

Are any employees excluded from superannuation requirements?

A limited category of employees are excluded and need not be provided for under the Superannuation Guarantee scheme, including:

  • employees aged 70 years or over;
  • employees paid less than $450 a month;
  • non-resident employees paid for work done outside Australia;
  • resident employees employed by non-resident employers for work done outside Australia;
  • part time employees (that is, employed to work not more than 30 hours per week) under 18 years of age; and
  • a person employed for not more than 30 hours per week to carry out work of a domestic or private nature.


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Last Updated on Monday, 02 September 2013 21:41

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