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Superannuation Amnesty Continues... for now

 In March this year, the Australian Taxation Office announced a superannuation amnesty for businesses - a one-off opportunity to correct past unpaid superannuation guarantee (SG) amounts without incurring administration charges or penalties of up to 200% of the SG charge.

A genuine error with SG payments can compound over successive quarters. The amnesty offers a chance to fix these errors. To be eligible for the amnesty, you must declare and pay your SG shortfalls and interest charges within the amnesty period.

Where an employer pays an outstanding SG charge or superannuation contribution (or rectifies an underpayment) during the Amnesty Period and certain conditions are met:

  • the employer can claim a tax deduction to offset the SG charge; and
  • the employer will not be subject to any penalties or administrative fees which are usually applied to late and non-compliant payments.

However, the employer will still be liable to pay interest on late payments of SG charges.

The SG Amnesty is available for a six month window ending 7 September 2020. Employers will need to self-report to the Australian Tax Office to avail themselves of the SG Amnesty.

The ATO has recently acknowledged that employers affected by COVID-19 may not be able to pay their liability and advised that it would work with them to establish a payment plan that is flexible to help assist them in making payments. These arrangements include:

  • flexible payment terms and amounts which we will adjust if circumstances change; and
  • the ability to extend payment plans to beyond 7 September 2020, the end of the amnesty period (only payments made by 7 September 2020 will be deductible).

This article contains general information only and is not legal or financial advice. We suggest you speak with your accountant or with the ATO if you require further information.

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