The federal government’s recently announced 12 month Amnesty on underpaid super is welcomed news for employers, providing a one-off opportunity to self-correct past super guarantee (SG) non-compliance without penalty.
If the legislation is passed as announced, the Amnesty will be available from 24th May 2018 to 23rd May 2019. Employers who voluntarily disclose previously undeclared SG shortfalls during the Amnesty, and before the commencement of audit activity will:
• not be liable for the administration component and penalties that may otherwise apply to late SG payments, and
• (perhaps more importantly) be able to claim a tax deduction for catch-up payments made in the 12-month Amnesty period.
Employers will be required to pay all employee entitlements, including the unpaid SG amounts owed to employees and the nominal interest, as well as any associated general interest charge (GIC).
The Amnesty is applies to previously undeclared SG shortfalls for any period from 1 July 1992 up to 31 March 2018. It will not apply to the period starting on 1 April 2018 or subsequent periods.
It represents a good opportunity for employers to get their super obligations in order. The government has signaled that there will be higher penalties for correcting past sins once the Amnesty is over.