The Australian Government will reduce the disproportionate penalty on employers who make late superannuation guarantee contributions in an attempt to honour their obligations to employees.
Currently, employers who make a late contribution to a superannuation fund may end up paying this amount again as late contributions cannot be used to offset the liability to the ATO. This liability includes the unpaid superannuation contribution, interest on that amount and a penalty.
Under the new arrangements, the Government will allow employer contributions made for an employee to a superannuation provider within 30 days of the SG due date to be used to offset the portion of any SG charge for the quarter that relates to that employee.
Employees will still receive their full superannuation shortfall plus interest to compensate them for the late payment.
The arrangements will apply to late payments of contributions made on of after 1 January 2006.