Collecting superannuation and sending it to the ATO is a critical step in your payroll process.
There are four deadlines for each year and it is important that businesses pay their super obligations before this day. If they haven't received the payment by that day (even if it is a few days late) it can have costly ramifications on your business.
Here are our compelling reasons why you need to make meeting these deadlines a priority:
1. ATO Audits
You can actually trigger an audit! That’s right, missing your obligation by just a couple of days can actually trigger an Employer Obligation Audit. The ATO will then use ‘data matching’ to conduct an audit on you. This is where they collect data about your business to ensure that it is compliant with current legislation. No one wants an audit, it can be time consuming, costly and not to mention stressful.
2. Tax Deductions
Any super that is paid by you on behalf of your employees is tax deductible. But! And this is a big BUT! If you don’t pay your super obligation by the due date then you can’t claim it as a tax deduction. This is even if it is late by a couple of days, making your income and therefore subsequent tax bill higher at the end of the financial year. This is particularly devastating if a business pays only a few days late.
3. Superannuation Guarantee Charge (SGC)
For every quarter that a business pays their contribution late they are required to lodge an SGC Statement to the ATO. The ATO will then impose a late payment charge (the shortfall between the due amount and what was actually paid). But if you thought it couldn’t get any worse the ATO then imposes an interest charge plus an administration fee, and this is per employee, per quarter.
Cut off Dates
Below we have listed the cut off dates for each quarter. It is important to note that the payments must be received, not sent by the due date. So make sure you pop it in your diary to send the payments a day or two before the cut off date.
- Quarter 1 - 1 July-30 September - Cut off date - 28th October
- Quarter 2 - 1 October - 31 December - Cut off date - 28 January
- Quarter 3 - 1 January - 31 March - cut off date - 28 April
- Quarter 4 - 1 April - 30 June - cut off date - 28 July