What is the Superannuation Guarantee amnesty?

In this article, the following factual information is not intended to imply a recommendation or opinion of any Superannuation Product.

The Superannuation Guarantee amnesty proposes to provide a one-off amnesty to encourage employers to self-correct any historical non-compliance of the Superannuation Guarantee.

The amnesty limits the Commissioner of Taxation’s ability to penalise those for historical non-compliance and for failure to disclose their Superannuation Guarantee shortfalls in the past.

The first announcement of the Superannuation Guarantee amnesty was in May 2018. The intended time frame of the amnesty was from 24 May 2018 until the 23 May 2019. However, the legislation failed to pass through parliament. 

The Australian Taxation Office (ATO) advised the Senate Economics Legislation Committee that the commissioner has been exercising their discretion to apply a remission to the current penalty. As such, employers have paid back approximately $100 million of unpaid superannuation to employees.

On 18 September 2019, the legislation was reintroduced to parliament. If the bill passes,  employers are expected to come forward and pay back their employees the full amount that they rightfully deserve.

Employers will only be able to take advantage of the if they fully repay, with interest, the amount owed to their employees and any costs associated. Additionally, they must declare their non-compliance with the Superannuation Guarantee. In return, the employers will not receive the typical penalties for their non-compliance.

The Superannuation Guarantee charge consists of the full amount owed, 10% interest and an administration fee. Any businesses which fail to repay their employees during the amnesty period may face a 100% penalty on top of the existing charge. 

During the amnesty period, the ATO will still be conducting investigations into non-compliant businesses and penalise those who do not voluntarily come forward.

This information has been prepared without taking account of the needs, objectives, or financial situation of any particular individual .

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