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Unpaid superannuation guarantee - Amnesty Bill passes Parliament

There are many businesses in Australia that have not been paying their staff's superannuation guarantee (SG) entitlements. A one-off amnesty to make good on their compliance has now been passed in Parliament on 25 February 2020.

This amnesty will apply from 24 May 2018 to 6 months after the Bill receives royal assent.

There is a rather generous disclosure period that applies to this amnesty being the quarter starting 1 July 1992 to the quarter ending 31 March 2018. 

The main qualification for the amnesty to apply for the employer is that the ATO must not have previously declared an investigation into the financial quarter in question. 

The passed legislation also has strict penalty provisions which the ATO must charge if an employer fails to declare a SG shortfall post-amnesty period. This can be "a minimum 100 per cent penalty on top of the SG shortfall they owe, and up to 200 per cent for the most serious cases." which has been stated by Assistant Minister Jane Hume.

Interest will still be payable by the employer for the superannuation this amnesty covers, but the additional penalties the ATO would normally charge will not be imposed.

For employers who have not paid SG from 1 April 2018 will be subject to the normal penalties, interest and non-deductibility rules. This does not mean it should not be paid - quite the contrary in fact as those funds belong to the employees and is effectively wage-theft if left unpaid.

Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019 - click here for the Explanatory Memorandum of the Bill

This information is general in nature and does not constitute financial or other professional advice.

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