Superannuation Guarantee (SG)
Superannuation Guarantee (SG) legislation requires that employers make super contributions for their eligible employees. It defines which employees are eligible and how contributions are calculated and made.
In general terms, you have to pay superannuation for any employee who
- is aged 18* to 69
- is paid $450 or more (before tax) in a calendar month
- works full time, part time or as a casual.
You may also need to pay super for contractors employed wholly or principally for labour. A contract is usually considered principally for labour if more than half the dollar value of the contract is for the person’s labour.
How much SG has to be paid?
A legislated minimum SG rate applies to all eligible employees but you may need to pay more based on any awards or employment agreements. The current minimum rate is 9% but from 1 July 2013 this will be gradually increasing to 12% by 2019.
When are SG contributions to be paid?
The dates for payment of SG Contributions are provided in the table below.
| Quarter | Period | Payment Due Date |
| 1 | 1 July – 30 September | 28 October |
| 2 | 1 October – 31 December | 28 January |
| 3 | 1 January – 31 March | 28 April |
| 4 | 1 April – 30 June | 28 July |
SG Charges
Employers who do not make employee contributions on time or in full may be subject to a penalty imposed by the Australian Taxation Office (ATO) known as the SG Charge.
The charge is the sum of:- the SG shortfall amount
- interest on that amount (10% p.a.)
- an administration fee of $20.00 per employee per quarter.
Award Employees
The SG covers most working Australians. However, some employees are covered by an industrial award or a workplace agreement that includes provisions that replace or provide additional superannuation obligations. If you have employees eligible for super who are covered by an award, there may be some specific rules you must follow as some awards may impose additional superannuation obligations over and above the SG.
However, you must use SG rules if the super entitlement under an award is less than the SG.
