On 1 July 2014, the superannuation rate for employees increased from 9.25% to 9.5%. Superannuation contributions form a key component of the pay that eligible employees receive as part of their normal salary and wages. You can read more about superannuation and eligibility of employees for superannuation here.
What impact does this superannuation rate increase have when running the payroll for your small business:
- If an employee receives a payroll package of say $50,000 including superannuation, more of this package will go to superannuation and employees will receive less cash in hand as part of their ongoing pay.
- If you are paying casual staff members, the superannuation rate increase will probably mean you are paying your staff members more each month as they are generally paid on an hourly basis plus superannuation.
- If you pay your employees fortnightly and the first pay day is 4 July 2014, you might be wondering if you need to use two different calculations for superannuation. According to the ATO, you only need to do one calculation and this would be using the new 9.5% superannuation rate.
- And don’t forget that superannuation is due by the latest 28 days after the end of each quarter.
Tax Tips Tuesdays is brought to you with love from Nudge Accounting.