“One-off opportunity”: Government offers olive branch to businesses with superannuation amnesty extension

A proposed superannuation amnesty extension will allow small businesses to address any outstanding Superannuation Guarantee (SG) obligations without penalties.

The extension of the one-off amnesty was introduced into parliament last Wednesday by Assistant Minister for Superannuation, Financial Services and Financial Technology Jane Hume.

“Employers will not be off the hook — to use the amnesty, they must still pay all that is owing to their employees, including interest,” Hume said in a statement.

“Importantly, employers who do not take advantage of the one-off amnesty will face significantly higher penalties when they are subsequently caught — typically employers will face a minimum 100 per cent penalty on top of the SG Charge they owe.

“My message to employers who owe super is: come forward now. Do not delay. This is a one-off opportunity to set things right,” Hume said.

In a statement released on Friday, small business and family enterprise ombudsman Kate Carnell welcomed the extension, stating it “effectively encourages employers to catch-up on paying superannuation entitlements to staff, without being slugged with the harsh penalties that usually apply”.

“All Australian workers should be paid the entitlements they’re owed. The amnesty, if passed, would give small businesses a short amount of time to ensure they are compliant.

“If this bill gets through, small businesses should act quickly to take advantage of the amnesty or face significantly higher penalties if found to be non-compliant,” she said.

Complaints against employers for non-compliance steeply increased by 56% in the 2017-18 financial year, prompting the initial 12-month amnesty period.

The original superannuation amnesty period ended in May 2019. During the amnesty period, “over 7,000 employers have come forward to voluntarily disclose historical unpaid super”, Hume said.

The proposed extension comes a month after the Australian Taxation Office (ATO) said it will use increasingly available data to send proactive “nudges and warnings” to employers who aren’t complying with their SG obligations.

“The amnesty reinforces recent changes to the superannuation system to improve the visibility employees have over their superannuation,” Hume said.

“We have given the ATO greater powers to ensure employers meet their obligations, and to help ensure employees receive their superannuation entitlements.”

SG legislation currently requires employers to contribute 9.5% of employee wages to either a super fund or a dedicated retirement savings account.

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