Super guarantee – a focus area for the ATO through 2023/2024

The Australian Taxation Office (ATO) released its 2023/2024 Corporate Plan in July and as anticipated, have identified ‘superannuation guarantee (SG) integrity’ as one of eight focus areas.

The ATO’s objective is to continue expanding the use of data to improve SG compliance, monitoring whether employees receive correct and timely superannuation entitlements and taking firm action against employers who fail to meet their obligations. Single touch payroll data will be the ATO’s main, but not only, data source.

To add complexity, it is possible that the classification of some workers as being entitled to SG or not may have changed as a result of recent court decisions. In particular, how section 12(3) of the Superannuation Guarantee (Administration) Act 1992 applies to individuals working under contracts for labour has been clarified by the Full Federal Court in Jamsek and JMC, and may yet be subject to further clarification if the ATO’s special leave application from JMC is successful.

In light of the above, it is critical that employer’s review their SG practices and processes as a matter of priority. Immediate focuses should include:

• review of payroll system configurations for alignment with SG obligations
• review of governance processes and policies around how workers are to be classified for SG
• consideration being given to the making of voluntary disclosures where any historic misclassifications are identified.

If you need any assistance with the above, please get in touch with partner Megan Bishop. For more resources, visit our Tax Hub.

Disclaimer
The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

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