If you’re eligible for super guarantee (SG) contributions, your employer must pay the minimum SG contribution based on the current super guarantee rate, being 10.5% of your ordinary time earnings (up to the ‘maximum contribution base’ – rate current as of 1 July 2022) into your super account at least every three months.
SG payments are classified as employer contributions and count towards your concessional (before-tax) contributions cap.
Ordinary time earnings are generally what you earn for ordinary hours of work, including:
- over-award payments
- commissions
- allowances
- bonuses
- paid leave.
If you’re a contractor, the minimum super amount should be calculated on the labour component of your contract, if it’s possible to separate it. Otherwise, it should be calculated on the total amount.
Calculator: Estimate my super will help you calculate your SG entitlement.
Working overseas
If you take up an Australian employer’s offer to temporarily work overseas, your employer must continue to pay super contributions for you in Australia.
You or your employer won’t have to pay super (or a super equivalent) in the other country if both the following apply:
- the country has a bilateral social security agreement with Australia
- your employer obtains a certificate of coverage from ATO.
Opt-out of receiving super guarantee
If you have two or more employers and expect your employers’ super contributions will exceed your concessional contributions cap for a financial year, you can apply to opt-out of receiving SG from some of your employers.
Talk to your employer about the effect an exemption certificate may have on your pay or other entitlements before you apply. Note also that your employer can disregard an exemption certificate and continue paying SG.
When all feels overcomplicated, you can always hire a specialist. Our team of financial advisers and accountants will be happy to sort everything out for you. Contact us today.
Information source www.ato.gov.au
