Specialist Dental Accountants

Superannuation - take steps now to avoid a "please explain"​ letter from the ATO

HomeUpdatesNewsSuperannuation - take steps now to avoid a "please explain"​ letter from the ATO

Superannuation - take steps now to avoid a "please explain"​ letter from the ATO

Each year we hear the rumblings about what areas of interest are on the ATO “hit list”.  Perhaps one of the most important ones to come out in this financial year is Superannuation Guarantee. 

As an employer, one of the biggest changes you have seen in the past decade would undoubtedly be Single Touch Payroll.  This new system allows the ATO data matching information in real time, in a way we haven’t seen before.

Through Single Touch Payroll, the ATO receives details of each employees gross earnings, PAYGW, and the super guaranteed amount you owe - every time you finalise a payrun.

On the other side, Superannuation Funds (as of 1st July 2018) are now also required to report member contributions or transactions within 10 business days of the event or allocation to a member’s account.

These tighter measures mean that the ATO will know (almost) instantly whether you have met your quarterly deadline for superannuation payments, and if you are entitled to claim a tax deduction for superannuation paid.

Now is the time to be proactive. If you have any outstanding super guarantee transactions that need to be paid, please contact your MW Partners Account Manager to discuss the steps to get this up to date.

(Not so) Fun Fact# 

If you have traditionally been leaving it until the 28th to make your payment - you are not allowing sufficient time for the funds to be processed, and it will be deemed as a late payment. Clearing houses (such as MYOB SuperStream) advise that it usually takes 4-5 business days for the transfer to take place, however, in some instances it can take as long as 10 business days. It is advisable that you make payment as early in the month as possible to remain compliant.

We highly recommend to our clients that they pay their superannuation obligations monthly instead of quarterly. This breaks the payment down into smaller bite-size pieces rather than one large payment that needs to be found each quarter which is also at a similar time to when BAS/GST and tax instalments are due. If you do get into the habit of paying monthly it means that if you inadvertently miss the payment deadline for the end of the quarter (i.e. your third month) you will only be penalised for late payment on a much smaller amount and you will also be able to show the tax office your good prior history of making payments monthly.

If you have any questions regarding your Superannuation obligations, please contact your MW Partners Account Manager – we’re happy to help at any time.

Albert Gigl