Single touch payroll (STP), the reporting mechanism employers must use to report payments to workers, provides a comprehensive, granular level of near-real time data to the regulators on income paid to employees. The ATO is now matching STP data to the information reported to them by superannuation funds to identify late payments, and under or incorrect reporting. The super guarantee laws do not have a tolerance for a ‘little bit’ late. Contributions are either on time, or they are not.

If an employer fails to meet the quarterly SG contribution deadline, they need to pay the SG charge (SGC) and lodge a Superannuation Guarantee Statement within a month of the late payment. The SGC applies even if you pay the outstanding SG soon after the deadline. The SGC is particularly painful for employers because it is comprised of:

• The employee’s superannuation guarantee shortfall amount – i.e., the SG owing.

• 10% interest p.a. on the SG owing for the quarter - calculated from the first day of the quarter until the 28^th day after the SG was due, or the date the SG statement is lodged, whichever is later;

• An administration fee of $20 for each employee with a shortfall per quarter;

• Potentially other penalties, particularly for repeat offenders.

Unlike normal SG contributions, SGC amounts are not tax deductible, even if you pay the outstanding amount. And, the calculation for SGC is different to how you calculate SG. The SGC is calculated using the employee’s salary or wages rather than their ordinary time earnings (OTE). An employee’s salary and wages may be higher than their OTE, particularly if you have workers who are paid overtime.

All this amounts to a strong incentive to pay your employees’ superannuation on time, no later than the due date each quarter.

For more information on SG and it's due dates, visit the ATO's website.

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