Tax tips, accounting, pay super, bookkeeping, small business, nudge accounting, startups

Do you have to pay super in your business? We go through the key requirements that business owners have to meet around superannuation for employees and contractors. The key steps to understand are as follows:

1. Relevant employees

(a) Full-time, part-time and casual employees
When it comes to superannuation contributions, you are required to pay contributions for employees if they are aged 18 years + and if they earn at least $450 or more in gross wages in a month.

b) Contractors
A common mistake we see businesses make is that they assume that they are not required to make superannuation payments for contractors. If an individual is paid mainly for their labour for hours worked under a contract, then you will have to pay super for them, irrespective of whether they are a contractor or an employee.

2. How much superannuation do you need to pay?

The current rate of superannuation is 9.5%

This rate of superannuation must be applied to the Ordinary Time earnings of your employees. This includes payment for your employees’ ordinary hours and whilst it includes commissions and performance based bonuses, allowances and shift-loadings; it does not include overtime payments.

3. When is superannuation due?

Superannuation guarantee contribution payments for your team need to be paid by the 28th day of the month following end-of-quarter. i.e. for the June quarter, payment of superannuation payments is due 28th July.

This Tax Tips Tuesday is brought to you with love by Nudge Accounting.