Mandated employer contributions

Technical resource

Mandated employer contributions are contributions by, or on behalf of an employer that are equal to the contributions made in relation to the member.

Information for advisers only.

An employer may be required to make mandated employer contributions for the benefit of eligible employees. Mandated employer contributions are contributions by, or on behalf of an employer that are equal to the contributions made in relation to the member that:

  • reduce the employer’s potential liability to the Superannuation Guarantee (SG) Charge
  • are payments of the SG shortfall components
  • are contributions to satisfy the employer’s obligation to make contributions under an award or agreement certified by an industrial authority (often referred to as award contributions).

Since 1 July 2013, employers are now liable to pay SG for all eligible employees. There are some employees that are excluded from this definition (non-exhaustive):

  • Employees paid less than $450 per month (proposed to be abolished from 1 July 2022)
  • Those under 18 years of age or performing work of a private/domestic nature that amounts to 30 hours or less per week
  • Employees who have opted out of receiving SG and the employer is covered by an SG employer shortfall exemption certificate for the quarter

These provisions are contained in the Superannuation Industry (Supervision) Regulations 1994 - Reg 5.01(1).

Generally, employers are only required to pay SG on an employee’s ordinary time earnings up to the ‘maximum contribution base’. For the 2021/22 financial year this is $58,920 per quarter.

Increases to the Super Guarantee

The SG rate is increasing progressively from 10% to 12% by 2025. The incremental increases are outlined in the table below.

Period SG rate (Charge %)
1 July 2021 - 30 June 2022 10%
1 July 2022 - 30 June 2023 10.5%
1 July 2023 - 30 June 2024 11%
1 July 2024 - 30 June 2025 11.5%
1 July 2025 - onwards 12%

Next: Work test exemption for recent retirees aged 65 to 74

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