Superannuation obligations for Aussie businesses.Article by Emma Warren
Even though we like to think that we’ll be young forever, it is not a realistic dream. One day, you will have to accept that those grey hairs and slouching stance are going to be the way of your future. Rather than denying it, you can plan for it. Thankfully, the Aussie Government has enforced strict laws that ensure every working Australian is saving adequate amounts of money in the lead up to their retirement.
Superannuation (or ‘super’ if you wanna get flashy) is exactly that – money paid to prepare for retirement. Super can either be managed by a super fund of your choice, or you can set up your own self-managed super fund (SMSF).
Super funds invest your money into many different things, including shares, property and managed funds. It is possible that your super fund can also offer you insurance, such as income protection insurance.
Superannuation for yourself, the business owner.
As a sole trader or partner of a business, you are responsible for paying your own super to yourself. (We know… ‘adulting’ is hard)
It is ultimately your decision as to whether you do or do not want to pay super to yourself. If your business is in the startup phase and you are scrambling for money, you might want to forget about super for now. However, once you are beginning to make a profit, stashing some dosh away for your retirement could be a smart decision.
If you are self-employed, you may be able to use super payments to your own benefit:
Superannuation for your employees.
If your business employs team members, then it is crucial you are paying superannuation in addition to your employees’ regular pay. All employees that earn $450 or more before tax in any calendar month must be paid super on top of their wages. This applies to all types of employees: full-time, part-time, casual, and even some contract workers.
As of February 2020, the minimum super that you must pay team members (Super Guarantee) is 9.5% of their base earnings.
As an employer, there are additional standards and actions you must adhere to. You need to:
Accurate and timely financial reports will help you to meet your obligations as a business owner and employer. Not only does Rumpel handle your bookkeeping for the entire month, but we can also assist with your payroll duties. We are a one-stop modern solution to cure the headache of business bookkeeping. Start a free trial on our website today.