Jodie Williams, who oversees the Action Dance Academy, finds herself among nearly a million small business proprietors bracing for a significant transformation in how employee superannuation payments will be handled. “It’s a considerable adjustment,” Williams shared with 9News, expressing her concerns about potential cash flow challenges that could arise.
Commencing July 1, employers will be required to synchronize superannuation payments with payroll, a departure from the previous quarterly system. The new regulation mandates that the funds must be deposited into the employee’s super account within seven business days of issuing their wages.
Failure to meet these deadlines could result in substantial penalties, including fines that could be as steep as 60 percent of the outstanding amount, along with accrued interest. This change underscores the importance of timely financial management for businesses across the nation.
From July 1, bosses must pay superannuation at the same time as wages, not quarterly.
The money has to hit the employee’s fund within seven business days.
If it is late, penalties of up to 60 per cent of the shortfall plus interest can apply.
Employment Hero superannuation general manager Rob Dunn said up to 58 per cent of employers were unaware of the payday super changes.
“Therefore they haven’t started to change their process to get ready,” Dunn said.
“So anyone who’s using that platform should be looking to make sure that they’re ready to change to modern embedded solutions.”
The earlier your money hits your fund, the more time it has to grow.
For example, a 25-year-old whose super is paid fortnightly instead of quarterly could earn an extra $4300 by retirement.
Each payday, employees should check that 12 per cent of their pay has gone into their super fund.
Employees can use the Australian Tax Office’s estimate tool to help work out the correct number.
If money is missing, employees should talk to their bosses.
If that fails, employees should lodge a complaint with the Australian Tax Office online.
The information provided on this website is general in nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website you should consider the appropriateness of the information having regard to your objectives, financial situation and needs.
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