Superannuation
Payment of superannuation is an obligation for all employers
All employers are obliged to make quarterly superannuation contributions for eligible employees under the federal Superannuation Guarantee (Administration) Act 1992.
How superannuation is calculated
Since 1 July 2002, the minimum level of superannuation contribution for employees has been nine per cent.
Superannuation is usually calculated based on an employee's "ordinary time earnings" - the definition of which may differ based on the provisions of the relevant award, agreement or on the wording of the trust deed of a particular superannuation fund.
Choice of superannuation fund
Both State and federal legislation allow most employees to nominate a superannuation fund of their choice.
The legislation regulating an employee’s choice of fund provisions will depend on whether the business concerned is deemed to be a constitutional corporation.
The publication Superannuation - Choice of fund [PDF 930kb] contains information on State choice of superannuation provisions.
Details on federal choice of fund provisions are available from www.ato.gov.au/super/
Exemptions
The legislation exempts employers from making superannuation contributions on behalf of certain employee groups, including:
- employees paid less than $450 in a calendar month;
- employees aged 70 years and over;
- employees under 18 years of age working 30 hours or less, per week; and
- employees paid to do work of a domestic or private nature for not more than 30 hours a week (e.g. a part-time nanny or housekeeper).
More information
For more information on superannuation obligations, contact the Australian Tax Office’s Superannuation Guarantee Hotline on 13 10 20 or visit www.ato.gov.au/super/.