What is Super Guarantee?

Super Guarantee (SG) was first introduced in 1992 and is the term for the mandatory super contributions employers must make on behalf of their eligible employees. It was introduced to ensure that all working Australians have adequate savings for their retirement.

Which employees do I need to pay super for?

You generally have to pay the Super Guarantee (SG) into a complying super fund for employees who are:

  • aged 18 or over and earn $450 or more before tax in salary or wages in a calendar month
  • aged under 18, earn $450 or more before tax in salary or wages in a calendar month and work more than 30 hours a week
  • contractors who are employed wholly or principally for their labour and paid for hours worked rather than to achieve a result. 

You need to pay super for employees who are temporary residents of Australia or are Australian residents working overseas and satisfy any of the above criteria.

If you run your business through a company, you also need to pay super for directors of the company who receive salary, wages or director’s fees.

How much super do I need to pay?

You need to pay at least 9.5% (the current Super Guarantee rate) of your employee’s ordinary time earnings in super.

Ordinary time earnings (OTE) are generally the amount an employee earns for ordinary hours of work.  It includes payments like commissions, allowances and certain bonuses but excludes overtime.  You do not usually need to pay Super Guarantee (SG) on the amount of an employee’s OTE that is above the maximum super contribution base ($52,760 per quarter for 2017/18, indexed annually).

Some employees are covered by awards or employment agreements that require you to pay super above the SG rate (currently 9.5%).

For more information about your super obligations visit the ATO website.

Are there exceptions as to when I have to pay the Super Guarantee (SG)?

You may not have to pay super for employees who are:

  • aged 18 or over and earn less than $450 before tax in a calendar month (you need to pay SG for any month the employee earns $450 or more)
  • under 18 and working 30 hours or less per week
  • non-residents completing work outside of Australia
  • on paid parental leave
  • receiving payments under the Community Development Employment Program.

For more information on which employees you need to pay super for, visit the ATO website.

How do I calculate how much super to pay?

You need to pay at least 9.5% (the current Super Guarantee rate) of your employee’s ordinary time earnings in super.

An employee’s ordinary time earnings (OTE)* generally includes:

  • salary or wages paid for ordinary hours of work
  • bonuses such as performance related bonuses  or Christmas bonuses
  • leave payments such as annual leave, sick leave and long service leave
  • shift-loadings for casual employees
  • certain allowances such as danger allowance or retention allowance
  • certain termination payments made in lieu of notice.

Generally OTE does not include overtime payments unless there is a specific agreement between you and the employee.

You do not usually need to pay Super Guarantee (SG) on the amount of an employee’s OTE that is above the maximum super contribution base ($49,430 per quarter for 2016/17, indexed annually).

You may still choose to pay 9.5% on this amount however, it is not compulsory unless required under an agreement between you and the employee such as an employment contract or a salary sacrifice agreement.

When do I need to pay Super Guarantee (SG) contributions?

You must pay the required SG contributions for your employees at least quarterly by the relevant cut-off date (shown in the table below).  You can choose to pay SG more regularly than this, such as fortnightly or monthly.

SG for OTE earned between: Must be paid by:
1 January and 31 March 28 April
1 April and 30 June 28 July
1 July and 30 September 28 October
1 October and 31 December 28 January

 

For more information about your SG obligations, visit the ATO website.

What happens if I don’t meet my Super Guarantee (SG) obligations?

If you don’t meet your SG obligations you will be required to lodge a Superannuation guarantee charge statement – quarterly form and pay a Superannuation Guarantee Charge (SGC) to the ATO.  You may also lose the tax deductions you would usually be able to claim for making super contributions.

You will generally have to pay the SGC if you:

  • don’t pay enough SG for your employee
  • don’t pay SG contributions by the quarterly cut-off date
  • don’t pay SG to your employee’s chosen super fund.

If you have paid SG contributions for your employees after the cut-off date you may be able to use the late payment as an offset to reduce the amount of SGC you have to pay.

For more information about your SG obligations, visit ato.gov.au and search ‘employers super’.

What am I required to contribute

In most cases, you are required to contribute a percentage of each employee’s salary to their super. This mandatory contribution is called Super Guarantee (SG). The SG is currently set at 9.5% of an employee’s ordinary time earnings. You may be required to pay more contributions under an industry award or other industrial agreement.

If an employee has signed a Choice of Super Fund and elected a fund other than BT Super you must pay the Super Guarantee contribution into the fund they selected (as long as it is a complying fund).

How do I make contributions to the BT super fund?

There are three different ways to make contributions through QuickSuper:

1.    Contribute using an online e-form

This option suits employers making contributions for less than 40 members. Simply enter the contribution amounts in the screen next to the name of your employee.

2.    Contribute using the standard QuickSuper

This option is best suited if you have more than 40 employees that are members of your BT Super plan as you can upload payment details from your existing systems into a spreadsheet.

3.    Use your own payroll file

If you have your own payroll system, you can use it to upload contributions. You will need to register your payroll file with QuickSuper if you have not previously done so, or if your payroll file has changed since you last registered it with QuickSuper.

Concessional contributions through salary sacrifice

Employees who wish to organise contributions from their before-tax salary (called salary sacrifice) must complete the Payroll Deduction Authority form for you to process.

Spouse contributions

Your employees can set up a BT Super account for their spouses, into which both partners can make after-tax contributions. Spouses can also apply for insurance cover and have access to the broad range of investment options. 

Additional contributions and contribution caps

You can make voluntary contributions that are in addition to any award or Super Guarantee (SG) requirements. However, you should consider that there are limits (known as ‘caps’) that apply to individuals when making additional contributions to super. Contributions exceeding these caps may have additional tax and charges applied to them. There are caps for both concessional (before-tax) contributions and non-concessional contributions. 

Whether you own a small business or run a big company, BT Super can help you manage your employer super with ease.

Answer a few simple questions to help you check if you’re meeting your business super obligations and doing the right thing for your people. It only takes about 5 minutes.

Our dedicated business super team is here to help you with everything super-related.
Mon-Fri, 8.30am-5.30pm Sydney time

Fund details for BT Super

Fund - Retirement Wrap USI BTA0287AU RSE R1001327 ABN 39 827 542 991. Trustee - BT Funds Management Limited ABN 63 002 916 458 AFSL No. 233724 RSE No. L0001090.

BTFM is the trustee and the issuer of interests in BT Super, which is part of Retirement Wrap. A Product Disclosure Statement (PDS) is available for BT Super and can be obtained by calling 1300 553 010 or visiting www.bt.com.au.  You should obtain and consider the PDS before deciding whether to acquire, continue to hold or dispose of interests in BT Super.

BTFM is a subsidiary of Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian credit licence 233714 (Westpac). Unless otherwise disclosed in the offer document for the relevant financial product an investment in BT Super is not an investment in, deposit with or any other liability of Westpac or any other company in the Westpac Group. It is subject to investment risk, including possible delays in repayment and loss of income and principal invested. Westpac and its related entities do not stand behind or otherwise guarantee the capital value or investment performance of the specific investments you select or the account generally.

BT has not reviewed any awards or other industrial instruments or agreements that are, or may become relevant to your employees. BT Super may not satisfy your obligations under any such award or industrial instrument or agreement. Before making a decision about BT Super, we recommend that you seek legal advice on its appropriateness, having regard to the requirements of any awards or other industrial instruments or agreements that are, or may become applicable.

The information provided is factual only and does not constitute financial product advice. Before acting on it, you should seek independent financial and tax advice about its appropriateness to your objectives, financial situation and needs. The information is current as at February 2020 and provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such.