The super guarantee charge (SGC).
All you need to know about the super guarantee charge and how to ensure compliance and avoid penalties.
What is the SGC? Super Guarantee Charge
To explain this simply the super guarantee is a compulsory amount that an employer must pay into their employee’s chosen super fund as part of their employment conditions. The employer has 28 days after the end of each quarter to make this payment. If the employer fails to pay the employee’s super by the due date, then this is when the Super Guarantee Charge is applied.
The SGC is a charge incurred if you don’t pay the minimum amount for your employee into the correct fund by the due date. The charge is non tax-deductible and calculated to include the following;
- Super guarantee (including any choice liability)
- Interest on the above amounts (currently 10%)
- An administration fee of $20 per employee, per quarter
You must report and rectify any missed payment and lodge an SGC statement by the due date and pay the SGC to the Australian Tax Office (ATO).
If you pay your super guarantee late, you may be able to use the late payment rules either to offset the SGC or to carry forward the amount as a pre-payment of a future contribution for the same employee. However, you must still lodge an SGC statement and pay the balance of the SGC to the ATO.
Please note the following dates;
Super Guarantee reporting and payment due dates;
|Quarter||Period||SG Reporting & Payment Date to the Employee’s Super Fund|
|1||1 July – 30 September||28 October|
|2||1 October – 31 December||28 January|
|3||1 January – 31 March||28 April|
|4||1 April – 30 June||28 July|
If you don’t pay the minimum amount by the above reporting and payment dates you will need to adhere to the SGC schedule lodgement and payment due dates as below;
|Quarter||Period||SGC Payment & Lodgement with the ATO by the following dates|
|1||1 July – 30 September||28 November|
|2||1 October – 31 December||28 February|
|3||1 January – 31 March||28 May|
|4||1 April – 30 June||28 August|
With the implementation of data matching, single touch payroll and generally the ATO being more active in this area noncompliance will be easier for the ATO to discover.