Superannuation Archives | Northern Beaches Bookkeeping Solutions

Feb 16

Behind With Your Super Payments? How to Catch Up and Avoid ATO Penalties

Falling behind on superannuation payments can have serious consequences for small businesses, including financial penalties and damaged employee trust. If you’re behind on super payments, it’s important to take immediate action to catch up and stay compliant with ATO regulations. Here’s a step-by-step guide to getting back on track.

What Happens If You’re Behind on Super Payments?

If superannuation payments are not paid by the quarterly due date, the ATO may impose a Superannuation Guarantee Charge (SGC). This charge includes:

Unpaid Super Amount: The amount of super that should have been paid to employees.
Interest on Unpaid Super: Currently set at 10% per annum, calculated from the due date.
Administration Fee: $20 per employee per quarter for missed payments.

Steps to Catch Up on Unpaid Superannuation

To resolve unpaid superannuation and minimise penalties, follow these steps:

1. Calculate Unpaid Super: Review payroll records to identify missed super payments and calculate the total amount owed.
2. Lodge an SGC Statement: Complete a Superannuation Guarantee Charge (SGC) statement to report unpaid super to the ATO.
3. Pay the SGC: Pay the SGC directly to the ATO, including unpaid super, interest, and administration fees.
4. Update Payroll Records: Adjust payroll records to reflect paid super and ensure future contributions are calculated correctly.
5. Implement a Payment Plan: If you can’t pay the full SGC amount upfront, contact the ATO to discuss a payment plan.

How to Avoid Falling Behind on Super Payments

Preventing future superannuation issues requires a proactive approach to payroll and financial management. Consider the following strategies:

Automate Super Payments: Use payroll software to calculate and pay super automatically each pay cycle.
Set Payment Reminders: Schedule reminders for quarterly super due dates to avoid missing payments.
Reconcile Payroll Regularly: Review payroll reports to verify that super amounts are accurately calculated and paid.
Hire a Bookkeeper: A qualified bookkeeper can monitor super obligations, lodge SGC statements, and ensure compliance.

Superannuation Due Dates to Remember

Superannuation payments are due quarterly. Mark these key dates in your calendar:

1st Quarter (July – September): Due by 28 October
2nd Quarter (October – December): Due by 28 January
3rd Quarter (January – March): Due by 28 April
4th Quarter (April – June): Due by 28 July

Penalties for Late Super Payments

The ATO takes unpaid super seriously. If you fail to pay super on time, you may face the following penalties:

Superannuation Guarantee Charge (SGC): Includes the unpaid super, interest, and admin fee.
Failure to Lodge Penalty: Additional fines for not lodging an SGC statement on time.
Director Penalty Notices: Company directors may be held personally liable for unpaid super.

Need Help Catching Up on Unpaid Super?

If you’re behind on super payments and unsure how to resolve the issue, Northern Beaches Bookkeeping Solutions can help. Our experienced bookkeepers can review your payroll records, calculate unpaid super, and assist with lodging SGC statements to the ATO. Contact us today to get back on track and avoid further penalties.

Payroll & Employees, Superannuation by Coralie Downie

Jan 25

SuperStream Obligations – A Guide for Small Businesses

SuperStream is a mandatory electronic payment system for superannuation contributions in Australia. Designed to streamline super payments and reduce paperwork, SuperStream ensures that superannuation data and payments are transmitted in a consistent and secure format. Here’s what small businesses need to know about meeting their SuperStream obligations and staying compliant with ATO regulations.

What Is SuperStream?

SuperStream is a government initiative that requires employers to pay super contributions electronically while sending corresponding payment data in a standardised format. This system ensures that contributions reach the correct employee super funds efficiently and accurately.

Who Must Comply With SuperStream?

All employers in Australia, regardless of size, must comply with SuperStream requirements when making superannuation contributions for employees. This includes:

Sole traders and small businesses
Companies and trusts
Non-profit organisations

SuperStream Payment Methods

Employers can meet their SuperStream obligations by using one of the following payment methods:

Payroll Software: Most accounting and payroll software, such as Xero, MYOB, and QuickBooks, are SuperStream compliant and can automatically process super payments.
Super Clearing House: The ATO’s Small Business Superannuation Clearing House (SBSCH) is a free service for small businesses with fewer than 20 employees.
Third-Party Providers: Approved SuperStream providers can handle super payments and reporting on your behalf.

How to Set Up SuperStream

To set up SuperStream for your business, follow these steps:

1. Register for Payroll Software: Choose a payroll solution that is SuperStream compliant and set up employee details, including super fund information and employee Tax File Numbers (TFNs).
2. Verify Super Fund Details: Ensure that each employee’s super fund is SuperStream ready. Obtain the super fund’s unique identifier (USI) and bank details.
3. Collect Employee Super Information: Request Super Choice forms from employees to confirm their nominated super fund details.
4. Make Super Payments Electronically: Process super payments through your payroll software, clearing house, or third-party provider. Ensure that payment data is submitted in the SuperStream format.
5. Keep Records of Payments: Maintain records of super payments, including payment dates, amounts, and recipient fund details.

SuperStream Reporting Requirements

When making SuperStream contributions, employers must provide the following data for each payment:

Employee name and Tax File Number (TFN)
Payment amount and payment date
Unique Superannuation Identifier (USI) for the fund
Payment reference number to track the transaction

Common SuperStream Mistakes to Avoid

To avoid ATO penalties and ensure compliance, be aware of these common SuperStream mistakes:

Failing to include all required data in SuperStream payments
Submitting payments outside the required quarterly deadlines
Incorrect employee details, such as TFNs or super fund USIs
Not reconciling super payments against payroll records

SuperStream Payment Deadlines

Super payments must be made at least quarterly, with the following deadlines:

1st Quarter (July – September): Due by 28 October
2nd Quarter (October – December): Due by 28 January
3rd Quarter (January – March): Due by 28 April
4th Quarter (April – June): Due by 28 July

Need Help With SuperStream Compliance?

Managing SuperStream obligations can be complex, especially for small businesses without dedicated payroll staff. Northern Beaches Bookkeeping Solutions offers comprehensive payroll and superannuation services to help you stay compliant and avoid ATO penalties. Contact us today to learn more about our SuperStream services and payroll solutions.