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ATO data regarding Superannuation Guarantee non-compliance

The ATO has provided some information about Superannuation Guarantee (SG) non-compliance in its recent submission to a Senate inquiry into the impact of the non-payment of the Superannuation Guarantee.

In addition to marketing and education activities to re-enforce the need for employers to meet their SG obligations, the ATO conducts audits and reviews to ascertain SG non-compliance, with 70{8c9c1ff2dd97e2d6259091c549649f3540ea2a8d186629f84b534d36b0353f14} of cases stemming from employee notifications (the remaining 30{8c9c1ff2dd97e2d6259091c549649f3540ea2a8d186629f84b534d36b0353f14} of cases are actioned from ATO-initiated strategies).

On average, the ATO receives reports from employees which relate to approximately 15,000 employers each year, although the ATO finds that nearly 30{8c9c1ff2dd97e2d6259091c549649f3540ea2a8d186629f84b534d36b0353f14} of these employers have in fact paid the required SG to their employee.

However, an SG shortfall is identified in the remaining 10,000 cases (this represents approximately 1{8c9c1ff2dd97e2d6259091c549649f3540ea2a8d186629f84b534d36b0353f14} of the estimated 880,000 employers who make SG payments).

The top four industries from which reports are received by the ATO are from:

  •       Accommodation and Food Services;
  •       Construction;
  •       Manufacturing; and
  •       Retail Trade.

These four industries represent approximately 50{8c9c1ff2dd97e2d6259091c549649f3540ea2a8d186629f84b534d36b0353f14} of the audits and reviews undertaken.

Know your obligations

To avoid ATO SG audit or to sail through it smoothly, we suggest that you:

  1. Comply with the superannuation guarantee rules

  •  pay your super at least quarterly within 28 days after the end of relevant quarter
  • use Superstream compliant payroll solution
  • classify your employees and contractors correctly

 

Read more in our article  HERE

2. Have an audit insurance to cover your accounting and/ or legal cost in case you do get audited

Find more information about our audit shield.

3. Communicate with your employees.

They are less likely to go complain to someone else if you address their concerns.

The ATO also noted that the proposed Single Touch Payroll (‘STP’) will help overcome certain limitations in the data currently provided to the ATO (as well as simplify taxation and superannuation interactions for employers, by aligning the reporting and payment of PAYG withholding and SG with a business’s natural process of paying their employees).

Use of STP is mandated for businesses with 20 or more employees from 1 July 2018, and a pilot program will be undertaken in 2017 to identify the nature of STP benefits for small businesses. You can find more details about STP here on ATO website.

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