Super double whammy relief
Wednesday, October 3, 2007/
Employers who are slow to pay employees quarterly super contributions will no longer face massive penalties.
The federal Minister for Revenue, and Assistant Treasurer, Peter Dutton, yesterday announced that late payers no longer have to pay the super guarantee charge, which includes the amount of the contribution plus interest and an administration fee, and is directly payable to the tax office.
The penalty effectively meant the late paying employer paid the contribution twice – once to the employees’ fund, and once to the tax office.
Business groups have welcomed the change, saying that the heavy penalties have sent many small businesses with cash flow problems to the wall.
Late paying employers are not entirely off the hook: employees are entitled to the interest on the money they would have earned to compensate for the late payment.
The tax office has its sights on small and medium businesses with unpaid super contribution debts.
The Government provided additional funding of $125.7 million over four years in the 2007-08 budget to the tax office to chase debts harder. For more on the taxman’s targets in 2007-08 click here.
When the laws come into effect, employers will be able to use the offset, including employers who have already been assessed with the SG charge and that remains unpaid.