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WHY SHOULD YOU CARE ABOUT THE TIMING OF THE CONTRIBUTIONS?

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24
May

Concessional Super Contributions are employer contributions (before tax) to super including compulsory employer contributions & salary sacrifice. At the begging of every financial year, Australian taxation office sets a limit for contribution. If the total contribution of a member exceeds the limit, then he/she might be liable for additional tax on the excess contributions.

To claim tax deduction, you must have to pay super guarantee (SG) contributions quarterly for each eligible employee, otherwise, the employer will be penalised and must pay superannuation guarantee charge. The superannuation guarantee charge is not tax deductible; in this case the employee reserves the right to take legal action against the employer for late payment of contributions. On the other hand, if the employer is making Non-Concessional Super Contributions then he/she must pay the amount to employee’s super fund within 28 days.

You should care about the timing of the contributions because the employer is entitled to make super guarantee contributions for the quarter ending on 30 June by 28 July and it is your responsibility to keep track on the super account. By doing this you can avoid over contribution caps and payment of extra tax.


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