The ATO has made changes to employee Super Guarantee calculations, in specific relation to employees who salary sacrifice part of their wages.
We have summarised below these changes, but for a more detailed explanation and examples, please visit the following link: https://www.ato.gov.au/Business/Super-for-employers/In-detail/Salary-sacrifice/Salary-sacrificing-super---information-for-employers/?utm_source=sfmc&utm_medium=email&utm_campaign=&utm_content=&sfmc_key=00fec86d4ba37de7676be63190b3bbe29221f2db-U2FsYXJ5IFNhY3JpZmljZSBBVE8gVXBkYXRlIEVtYWls .
From the 1st of January 2020, the salary sacrificed amount elected by your employee, will not count towards your Super Guarantee (SG) obligations.
Before this change, you could choose to reduce the Super Guarantee obligations for the salary sacrificed super amount. This would reduce the amount of overall Super Guarantee you needed to pay.
Now, however, the Super Guarantee will be 9.5% of the employee’s ordinary time earnings (OTE) ‘base’. The ‘base’ is the total of the employee’s OTE and includes the employee’s elected sacrificed OTE amounts.
It is highly advised that you review your salary sacrificing arrangements and procedures to ensure compliance with these new changes. If you need to discuss this in more detail, please feel free to call and we will be more than happy to clarify any concerns you may have.