A change to salary sacrificing arrangements
Parliament recently passed laws to change the way salary sacrifice arrangements are processed.
Effective for quarters beginning on or after 1 January 2020, the new legislation prevents an individual’s salary sacrifice contributions from being used to reduce Superannuation Guarantee (SG) contributions.
After this date, the ATO will legislatively enforce SG contributions to be paid on top of an employee’s salary sacrifice arrangements.
For example, the current SG rate is 9.5%. An employee earning $10,000 over the quarter to 1 July 2020 would be entitled to $950 in SG contributions by the 28 July super payment deadline. If he salary sacrifices $100 a month into his super, his employer will need to contribute the $950 SG payment over and above the employees’ $300 salary sacrifice for the quarter. This would result in a total contribution of $1,250.
If you need any assistance with processing your employees’ SG and salary sacrifice contributions according to the new rules, you can get in touch with your local Relationship Manager.
You can also contact Intrust Super on 132 467 for assistance with your super payments. We are at your service.