If you don't pay super on time
If you don't pay an employee's super guarantee (SG) to the right super fund on or before the due dateExternal Link you must:
- lodge a super guarantee charge (SGC) statementExternal Link
- pay the super guarantee chargeExternal Link.
If an employee believes their SG contribution hasn't been paid correctly, they can contact us and lodge a referral. We have improved access to Single Touch Payroll and superannuation fund data, which is combined with employee referrals to help identify employers who may not have met their super guarantee obligations. We use this information to detect non-compliance and implement preventative and corrective strategies when employers do not meet their obligations.
We may also notify other employees about potential SG owed.
We can take firmer action to pursue outstanding debts, including the commencement of legal proceedings to recover an amount owed.
Your employee's super contribution is only considered 'paid' on the date it's received by the super fund. If you're using a clearing house, payments made to the clearing house that aren't processed, or don't reach the super fund until after the payment due date, are considered late payments.
Processing times vary between clearing houses. You must check the processing timeframes required by your clearing house. This will ensure your payments will be processed before the payment due dates.
Example: missed super guarantee payments
Teddy owns and runs a novelty store. He usually pays super for eligible employees on time. Due to unforeseen circumstances, Teddy misses paying super to his employees’ funds for the SG quarterly due date of 28 April (for the quarter ending 31 March).
Teddy knows that the SG quarterly due date can't be extended by law. He knows that to avoid penalties, he must lodge an SGC statementExternal Link (NAT 9599) within a month of the quarterly due date (in this case, by 28 May) and pay the SGC to the ATO for the outstanding super he owes.
Teddy can't pay the SGC in full but lodges his SGC statement through Online services for businessExternal Link by the due date to avoid additional penalties. He also sets up a flexible payment plan with us.
End of exampleMedia: Paying super guarantee late
https://tv.ato.gov.au/ato-tv/media?v=bi9or7odhem7wnExternal Link (Duration:03:01)
Late super guarantee payments
When SG payments are received after the quarterly super due date, they are considered late payments.
Your super guarantee obligations won't be met for a quarter where late payments have been made. Late payments will be used automatically to pay any super obligation you may have in the current quarter. This may mean late payments are applied to a quarter that is different to when you intended.
If you would like to use these payments to offset a super shortfall and nominal interest components of the SGC for an earlier quarter, you can make an election in your SGC statement in the late payment offset (LPO) section.
Example: late super guarantee payment
Frankie owns and runs an events management business. Frankie has one employee, who is paid monthly. Frankie usually pays their SG payments for this employee on time.
This quarter Frankie misses the SG payment due date. Payments for the first quarter are due on 28 October, but are not received by the super fund until 30 October.
The payments received by the super fund are applied to Frankie’s super guarantee obligation for the second quarter.
As Frankie has missed the due date, they must lodge a SGC statement and pay SGC to the ATO.
End of exampleLate super guarantee payment options
If you have made a late payment to an employee's super fund you may be able to:
- offset the shortfall and nominal interest components of the SGC
- put the payment towards future super payments. This is limited to a period no more than 12 months from the beginning of the quarter.
Offset the SGC with late super guarantee payments
You can offset late payments against the SGC if you have:
- made the payment to your employee's super fund
- made the payment before the date your original SGC assessment was made
- lodged your late payment offset election in the SGC statementExternal Link through Online services for businessExternal Link within 4 years of your original SGC assessment date.
The offset late super guarantee payments against the SGC:
- aren't tax-deductible
- can't be used as a contribution for the current quarter or future quarter's super contributions.
For quarters beginning on or after 1 January 2020, a salary-sacrificed contribution can't be offset against the SGC.
Note: A nomination to offset late payments is binding and cannot be changed. If you choose to have the contributions offset against the SGC, you can't withdraw this choice.
Example: late payment offset election
Jessie makes a late payment for the third quarter. It is received by the employee's super fund on 1 May, missing the 28 April due date. The super guarantee charge statement for this quarter is due on 28 May.
To have the super payment applied to the third quarter, Jessie needs to make a late payment offset (LPO) election in their SGC statement. This payment will automatically apply to the fourth quarter unless this election is made.
Jessie completes the SGC statement on 20 May, making an LPO election to move the payment to the third quarter.
End of exampleHow to lodge a late payment offset election
To lodge a late payment offset (LPO) election, use the SGC statementExternal Link (NAT 9599). Lodge through online services for businessExternal Link as follows:
- attach the SGC statement Excel spreadsheet to a new secure mail message
- select Superannuation as the topic
- select Lodge SGC statement as the subject.
If you're unable to lodge online, phone us on 13 10 20 for other options.
Example: electing a late super guarantee payment offset
Charles means to contribute to his employee's super fund by 28 April for the quarter ending 31 March. However, he makes his payment late on 1 July.
Charles has made his payment after the quarterly due date of 28 April. Because of the late payment, he is still required to lodge an SGC statement. Charles lodges an SGC statement through Online services for business on 10 July.
When he lodges his SGC statement, Charles elects to claim the super LPO. This will reduce the SG shortfall and nominal interest of the SGC. Charles then pays the remaining SGC to the ATO.
End of exampleCarry forward late super guarantee payments
You can carry forward a late SG payment if:
- it's for the same employee
- the start of the carried forward quarter is within 12 months after the payment date.
If you carry forward a late super payment, it is only tax-deductible in the year it's received by the super fund.
Example: late super guarantee payment carried forward
Hannah makes a late super payment for her employee on 5 November, missing the quarterly due date of 28 October.
As Hannah has missed the due date, she must lodge an SGC statement and pay the SGC.
Hannah decides to carry forward the late payment made on 5 November. She uses it towards the employee super for the quarter, ending 30 March in the following year. Hannah can do this because the payment is for both:
- the same employee
- a quarter in the 12 months following the date she paid it.
Super guarantee compliance approach
Our SG compliance approach supports employers that engage with us and want to get things right.
We may contact an employer by phone, email or letter if our data indicates they have underpaid or paid their SG obligations late to remind them of the requirement to lodge an SGC statement.
If you receive a contact letter or email from us and believe you have paid in full and on time to the employee's super fund, you need to:
- review your records and address any data issues to ensure you have met your obligations in full
- follow the instructions in the letter or email.
We conduct additional checks before taking firmer action for employers unwilling to meet SG obligations. In some cases, we will:
- undertake an SG audit of an employer
- raise SGC assessments with additional penaltiesExternal Link for not lodging the statement by the due date.
If you're unsure what action to take for your situation, you can phone us on 13 10 20.
Difficulty paying super guarantee
If you're having trouble meeting your SG obligations, you should make a voluntary disclosure. Complete and lodge an SGC statementExternal Link (NAT 9599) by its due date, even if you can't pay it in full. We will work with you to establish a payment plan.
Once you become liable to pay the SGC, nominal interest accrues to the later of the due date or date you lodge the SGC statement. We encourage you to lodge no later than the due date, to minimise nominal interest.
If you are experiencing difficulties lodging, phone us on 13 10 20 to discuss your circumstances.
Penalties
If you don't lodge the SGC statement by the due date, a Part 7 penaltyExternal Link will apply.
We are more likely to reduce or waive the penalty if you:
- make a genuine attempt to meet SG obligations
- have a good compliance history.
For example, we may reduce a penalty for an employer who lodged an SGC statement after the relevant due date, but before being notified of ATO compliance action.
If you don't lodge an SGC statement before audit action has started, a greater Part 7 penalty can apply. This could be up to 200% of the SGC.
How we can help
We can also help you:
- complete an SGC statementExternal Link
- work out a payment plan when you are unable to pay on time
- understand your super guarantee obligations through our voluntary online Super guarantee employer obligations – online courseExternal Link.
If you're unable to make a quarterly super contribution because you are affected by a disasterExternal Link, we can help.
Unwilling to meet obligations
We will take stronger compliance action – including imposing additional penalties – if you don't:
- engage with us promptly by replying to our correspondence
- take steps to resolve your outstanding super guarantee obligations.
We may also issue:
- a garnishee notice
- a director penalty notice
- a direction to pay SGC
- an education direction to complete the Super guarantee employer obligations – online courseExternal Link.
We take this approach with employers who:
- repeatedly don't pay the correct amount of super guarantee
- make it difficult for us to determine an SGC liability
- repeatedly fail to keep appointments
- repeatedly fail to supply information without an acceptable reason
- deliberately supply information that is irrelevant, inadequate or misleading
- engage in any behaviour to delay the supply of information.
For more information, see Super guarantee penaltiesExternal Link.
Help and support
For more help, you can:
- ask ATO CommunityExternal Link – our online community-driven forum to find tax and super answers
- contact usExternal Link.