10 Nov 2015

Do you know your superannuation obligations?

Case Study
Sole trader Chris failed to pay $2,500 superannuation guarantee for his employee Ron for the June 2015 quarter. Ron is 21 and a full time employee who has been working for Chris for two months. Chris is legally required to pay 9.5% of Ron’s ordinary times earnings to an eligible superannuation fund by the 28th day past the quarter. However Chris is new in business and was not aware of his superannuation obligations.

The ATO became aware of the non-payment of superannuation and issued an audit notice. Chris then realised he hadn’t made any payment and went to his accountant for help. Chris’s accountant told him to obtain Ron’s nominated superannuation fund details and then prepared a Superannuation Guarantee Charge Statement that calculated the following:

  • Superannuation guarantee shortfall $2,500
  • Administration fee $20
  • Interest on shortfall owed to Ron $134.25. Interest is payable from the beginning of the applicable quarter rather than the end of the quarter

When payments are late employers risk the following:

  • Large penalties and interest charges
  • Risk of staff loss
  • Legal action
  • Continued audits from the ATO

Should you wish to discuss your superannuation obligations please feel free to contact Andrew Marshall or Janine Orpwood on 5427 8100 for an initial consultation.


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