Wednesday, October 17, 2018

Employers welcome moves to reduce superannuation red tape

Fixing the administrative difficulties employers face when paying superannuation will improve compliance, the Australian Chamber of Commerce and Industry has announced.

In responding to the report of the Superannuation Guarantee Cross Agency Working, group director of Workplace Relations, Scott Barklamb, said:

“The rules for employers making superannuation payments are complicated and we welcome the recommendations to address this. We welcome changes which are fair and make it easier for employers to comply with the rules.

“The best way to ensure superannuation entitlements are paid on time is to make it easier for employers to make payments, and for them to correct any mistakes that come to light later. We are very pleased to see the Cross Agency Working Group will look to the administrative difficulties employers face and improve the lodgement process for superannuation.

“At the moment, many employers pay their employee’s superannuation on a quarterly basis. This lines up with their quarterly BAS statements and GST payments. It’s not a loophole, it is how the system currently works.

“The Government’s working group has recommended employers make these payments more often, perhaps fortnightly. This might look like a simple change but we warn against introducing it too quickly because moving from four payments per year to perhaps 26 can have an impact on business.”

“While many of the report’s recommendations seem reasonable, we would encourage the Government to consult widely with employers before legislating any changes.

“The way the superannuation legislation currently treats sacrificed contributions has been in place for many years. It’s not usual, but if people have entered into salary sacrifice arrangements which reduce the amount their employer superannuation is calculated against, it is important to know why they have done so and the consequences of changing the rules before enacting any change.”

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