Recently, you may have heard that a Superannuation Amnesty has been proposed by the federal government. While it hasn’t been passed into law yet, it is important that you know about the amnesty and how it will affect your business’s finances.
What is it?
The Superannuation Amnesty is proposed legislation that will remove the penalties for late Super payments to employees. The effects of the amnesty would apply to the time period that is specified, and would operate retrospectively. You will have to voluntarily disclose the amounts owing to the ATO to be able to access the Amnesty. The amnesty aims to encourage employers to pay outstanding super contributions.
Benefits
Chiefly, the Superannuation Amnesty will reduce the money that you owe if you have not followed the Superannuation Guarantee correctly. This means you will not have to pay the administrative charge and the Part 7 penalty for late payments. However, if you are subject to an audit of your Super, you will not be eligible for the amnesty.
Will I need to pay the penalties to the ATO?
As it is not certain that the guarantee will apply in your circumstances, you should pay outstanding penalties to the ATO. If you need help with managing your penalties and Super contributions, you should consider legal advice.
How to prepare
The best thing you can do is to pay your employee Super contributions on time and as required by the law. Any penalties that you have accrued should also be paid, as the ATO will apply the legislation retrospectively if it applies to you and give you a refund if you are eligible for it. To find out more, check out the ATO’s guide here.
Conclusion
It is therefore useful to know the effects of this potential law as it may positively impact upon your business. However, to achieve the best legal standing with the ATO you should disclose late or incorrect contributions.
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