On 6 March 2020, the Government legislated a Superannuation Guarantee amnesty that allows employers to disclose and pay unpaid superannuation, including the nominal interest, they owe their employees.
The amnesty allows employers to avoid penalties for unpaid superannuation, so long as applications are submitted before 7 September 2020.
This week, starting 3 August 2020, the ATO will begin sending notices to Australian employers reminding them of the upcoming deadline for the super guarantee amnesty. The amnesty expires on 7 September 2020.
The super guarantee amnesty is a one-off opportunity that allows employers to disclose and pay previously unpaid superannuation, dating back to July 1 1992.
To take up the amnesty, businesses must come forward and disclose to the ATO before the amnesty expires on 7 September, and either pay the unpaid amounts of superannuation in full with interest or put a payment plan in place to do so in the future.
Payments made by 7 September 2020 will be tax deductible.
Employers who don’t come forward in this amnesty period and are subsequently audited and found to have underpaid employees will face significant financial penalties.
And the economy wide roll out of Single Touch Payroll’s real time data reporting to the ATO means future underpayments are highly likely to be detected.
The ATO has acknowledged that some businesses may not be fully able to pay their super guarantee debt at this time due to the effects of Covid-19.
To encourage employers to still apply for the amnesty, the ATO has pathways in place to work with businesses and create payment plans to make good on unpaid super over time.