Government takes action to address superannuation guarantee non compliance

ACCOUNTANTS SYDNEY

The Government will seek to legislate a key recommendation of the Superannuation Guarantee Cross‑Agency Working Group to close a loophole that could be used by unscrupulous employers to short‑change employees who choose to make salary sacrifice contributions into their superannuation accounts.

The Minister for Revenue and Financial Services, the Hon Kelly O’Dwyer MP, said the Turnbull Government will introduce a Bill into Parliament this year that will ensure an individual’s salary sacrifice contributions do not reduce their employer’s superannuation guarantee obligation.

“If Australians are to continue to have confidence in the integrity of the superannuation system, we must ensure employers are paying workers their full entitlements, whether they are wages or superannuation,” Minister O’Dwyer said.

Minister O’Dwyer also released the report of the Superannuation Guarantee Cross‑Agency Working Group, Superannuation Guarantee Non‑compliance, which made a number of practical recommendations to improve employer’s compliance with their superannuation guarantee obligations.

The Government established the Working Group – comprising senior representatives from the ATO, the Treasury, the Department of Employment, ASIC and APRA – in December 2016. The Working Group’s report provides a set of targeted recommendations to improve superannuation guarantee compliance.

The Government also welcomed a key outcome of the Working Group, which has been strengthening cross-agency collaboration to improve the superannuation system for Australians. The ATO has increased its focus on Superannuation Guarantee compliance and information sharing across agencies has improved. Agencies are committed to a continued focus on protecting employee rights and entitlements and providing a level playing field for employers.

The Government is carefully considering the remaining recommendations made by the Working Group report to ensure that any measures progressed will improve compliance without unduly burdening employers.

In 2015-16 employers paid over $89 billion in superannuation contributions for their employees.

Article originally published here

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