Superannuation Guarantee Determination

SGD 94/5

If a contribution to a fund is made by cheque, when is the contribution made?

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FOI status:

may be releasedFOI number: I 1217216

1. A contribution to a fund by cheque is made when the cheque is received by the trustee of the fund, unless the cheque is subsequently dishonoured (Tilley v. The Official Receiver (1960) 103 CLR 529). If the cheque is dishonoured, a contribution will not have been made at all.

2. If a cheque is post-dated, the contribution will be made on the later of the day the cheque is received and the date shown on the cheque because it cannot be presented before the date shown (subsection 61(2), Cheques and Payment Orders Act 1986). Again, a contribution will not have been made if the cheque is dishonoured after presentation.

Example:

Kylie posted a $600 cheque to a superannuation fund on 11 August 1993 to cover contributions for 1992-93 for her employees. The fund received the cheque on 13 August. On 16 August the cheque was cleared, and the fund distributed the money to each employee's account on 17 August. Kylie met the 14 August deadline, as the fund received the cheque on 13 August. However, if the cheque had been dishonoured on 16 August, then the contributions would not have been made on time.

Commissioner of Taxation
14/4/94

Previously issued as draft.

This Determination has been replaced by SGD 2003/7.

References

ATO references:
NO NAT 93/4529-9

Subject References:
timing of payments;
payment by cheque;
contribution;
post dated cheques;
dishonoured cheques

Legislative References:
Cheques and Payment Orders Act 1986, subsection 61(2)

Case References:
Tilley v. The Official Receiver
103 CLR 529