If things slipped through the cracks during the winter rush and you missed the final quarterly superannuation payment on 28 July, it is incredibly important to act right now.
Paying your employees’ super even a day late means you have not met your obligations, which unfortunately results in a quarterly super debt. The rules have recently evolved, and taking the traditional approach to fixing a late payment could land you in further compliance trouble.
Here is a detailed breakdown of what you need to do if you missed the June quarter deadline.
Stop and do not pay the fund directly
In the past, your first instinct might have been to immediately transfer the missing funds directly to your employee’s superannuation fund. If the fund did not receive the full contribution by 28 July, you must not do this. Making a direct payment to the fund now will not wipe out your June quarter obligations. Instead, you are required to lodge a super guarantee charge (SGC) statement and pay the SGC directly to the Australian Taxation Office (ATO). The strict deadline for this is 28 August. Missing this secondary deadline will result in further penalties, so it is vital to get this statement lodged promptly.
The Payday Super catch
Why is a direct payment such a problem now? As of recently, the new Payday Super rules are in full effect. This means any super payments received on or after 29 July are automatically allocated to your Payday Super amounts. Even if you fully intended for those funds to cover the overdue June quarter, the ATO systems will assign them to your current payroll cycles. You will still have an outstanding SGC debt for the June quarter, essentially meaning you might pay double if you are not careful.
No more late payment offset
Another crucial update to be aware of is the removal of the late payment offset, commonly referred to as the LPO. Previously, employers could sometimes use late payments made directly to the fund to offset their SGC liability. However, the LPO is not available for this final quarterly payment. The only way to clear your June quarter debt is by lodging the SGC statement and paying the charge directly to the ATO.
Understanding the SGC statement
When you lodge an SGC statement, you are not just paying the original super amount. The charge is made up of a super guarantee shortfall (which is calculated on total salary and wages, not just ordinary time earnings), nominal interest, and an administration fee per employee, per quarter. This highlights why getting professional assistance is highly recommended to ensure you do not overpay or underpay the ATO.
Steps to get back on track
If you find yourself in this situation, do not panic, but do take immediate action. Here is a simple checklist:
– Audit your payroll records to determine exactly which employees were underpaid or paid late for the June quarter.
– Download and complete the SGC statement from the ATO website.
– Calculate the shortfall, the nominal interest, and the administration fee as required by the SGC rules.
– Lodge the statement and pay the total amount to the ATO by the 28 August deadline.
We understand that staying across these changing compliance rules can feel like a heavy burden. It is easy to make an honest mistake, but the ATO penalties for ignoring an SGC obligation are severe.
At Nova Business Services, we specialise in helping Australian businesses keep their books spotless and their payroll strictly compliant. If you need assistance lodging an SGC statement or want to ensure your systems are correctly set up for Payday Super moving forward, our friendly team is ready to assist. Visit our website at novabookkeeping.com.au to see how we can support your business today.
Our team is here to support you and your business in many different ways, give us a call on 1800 668 225 or reply to this blog by clicking here to ask us any questions.
