Are you aware of the changes to superannuation guarantee obligations that took effect from 1st January 2020? More importantly, are you on top of them?
Quite simply – if you have employees who are currently salary sacrificing, and this amount has been used to reduce your superannuation guarantee obligations, then this change will affect you.
From 1 January 2020, salary sacrificed super contributions can’t be used to reduce your super guarantee obligations, regardless of the amount your employee elects to salary sacrifice.
This means the salary sacrificed amount does not count towards your super guarantee (SG) obligations.
This change means that the Ordinary Times Earnings Base (OTE) is now comprised of the sum of the Employee’s OTE plus the amount salary sacrificed from the Employee’s OTE, and this is the amount used to calculate your superannuation guarantee obligations
What do you need to do?
- review your salary sacrifice arrangements to make sure you are:
- using your employee’s OTE base (that is – the Employee’s OTE plus the amount salary sacrificed from the Employee’s OTE) to calculate your SG obligation
- not counting salary sacrificed amounts towards the minimum amount of SG you have to pay
- check that all your systems are correctly calculating your Super Guarantee obligations.
You can find further information on the changes at Salary Sacrificing Super – Information for Employers