The Minister for Small Business, Bruce Billson, and the Assistant Treasurer, Josh Frydenberg, have announced the Government will consult on employers making Superannuation Guarantee contributions and PAYGW payments at the same time as salary and wages.
Currently superannuation guarantee only needs to be paid within 28 days of the end of the quarter. Pay As You Go Withholding (PAYGW) only needs to be paid quarterly or monthly for many employers.
The consultation will also examine “what support businesses may require to enable such a transformation in payments to government and superannuation funds.”
The Australian Institute of Superannuation Trustees (AIST) has welcomed the move to reduce the time between accruing a superannuation guarantee amount and making the contribution to a super fund. However AIST Executive Manager of Policy and Research, David Haynes, said it is “important for super funds to maintain a direct relationship with the employers sending contributions to them.”
“It’s easier for problems about super payments to be resolved when employers and super funds are talking directly to each other,” he said.
The AIST is concerned that the new system may involve super guarantee contributions going through the ATO, which could make the process “unnecessarily complicated.”
“Any changes to the way contributions are made need to be in the best interests of employees – not just employers.”
The Government also announced the simplification of PAYGW reporting through a process called Single Touch Payroll, and streamlining of the Tax File Declaration and Super Choice forms, see Single Touch Payroll to cut admin work for employers.
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