Treasury Laws Amendment (Recovering Unpaid Superannuation) Bill 2019 has now been passed the lower house without any amendments, and will be debated in the Senate.
The Bill has two key elements:
- One-off amnesty to encourage employers to fix superannuation guarantee non-compliance during the period 1 July 1992 to 24 May 2018.
Employers will be able to claim a tax deduction for the payments of the superannuation guarantee charge (interest and outstanding superannuation contributions). Please note to be eligible for the amnesty, the physical payments must be made during the amnesty period, being 24 May 2018 until 6 months after the day the bill receives royal assent.
No administrative charge or penalties
- After the amnesty period the Bill will impose minimum penalties equivalent to 100% of the amount of superannuation guarantee charge (interest and outstanding superannuation contribution) on employers who did not come forward.
The ATO is advising employers not to hold off and wait until the amnesty has passed parliament. ATO deputy commissioner James O’Halloran, said:
“We advise them not to do this as the law requires them to lodge the SGC; if they hold off and they’re notified we’re examining their affairs, they won’t be eligible for the amnesty; and if they lodge now and the law is passed, in its current form it is retrospective.”
Please remember that the ATO will continue its usual audit activity throughout the period. If an employer lodges its superannuation guarantee charge statements as a result of an ATO review or audit, the amnesty provision will not apply.
Should the amnesty legislation not become law, the existing laws will continue to apply.
Kennedy Barnden advises employers to review their outstanding superannuation obligations (if they have not already done so) and identify any disclosures of non-compliance required to the ATO. Given the major benefit of the amnesty, being the tax deduction available for super guarantee payments, is only available on amounts physically paid during the amnesty period, it is important that employers identify the quantum of the liability and use the time they have available to save for or obtain finance to pay the liability. Kennedy Barnden is available to assist employers with their review and completion of the superannuation guarantee charge statements.