As the Melbourne Cup approaches, here is a 3-minute and 17-second read that has even better odds of saving you money than Tuesday's favourite.
Seemingly every year, the ATO ramps up consequences for not paying employee superannuation guarantee on time and in full. The current stable of penalties include:
Fines: Employers who fail to pay super contributions can be fined up to 275% of all unpaid super contributions.
Interest charges: Employers who pay super late may also be charged interest on the unpaid contributions. Moreover, the interest doesn’t necessarily stop ticking when a payment is made, only when all the ATO paperwork has been lodged.
Director penalties: Company directors may also be personally liable for unpaid super contributions.
Imprisonment: In serious cases, employers who fail to pay super contributions may even be imprisoned.
As you can see, it’s better to pay on time and close the barn door before the horses bolt! Here are some tips for small businesses on how to make sure super is paid on time and in full:
Understand your super obligations. Make sure you know which pay rates are attracting super guarantee.
Set up a system and build good habits. Depending on your payroll service, you may be able to automate your super payments.
Don’t try and go neck and neck with the deadline! Pay a week early because a super payment can take up to 7 days to complete.
If you are a small business owner and need help with superannuation payments, there are several resources available to you. Firstly, you can always call the Makybe Diva of accountants, Vawdrey Axton Turner, on 03 9584 2277 if you want to discuss anything super, tax, or otherwise! Additionally, the Australian Taxation Office (ATO) has a dedicated website for small businesses with information on superannuation obligations.