Q: I am 16 years of age. I still go to school but I have just started my first part-time job. Do I get any superannuation? And if I do, where does it go?
Congratulations on your first job. You ask two questions about your super entitlements:
- Am I eligible for Superannuation Guarantee contributions from my employer?
- What happens to my employer’s superannuation contributions?
Am I eligible for Superannuation Guarantee (SG)?
Generally speaking, most employees are entitled to compulsory superannuation contributions paid by the employer. You must however be an eligible employee to be entitled to superannuation contributions paid by your employer (officially known as Superannuation Guarantee). If you are eligible then your employer must pay the equivalent of 9.5% of your ordinary time earnings into your super account for the 2018/2019 financial year (1 July 2018 through to 30 June 2019, and the same rate (9.5%) also applies for the 2019/2020 financial year (1 July 2019 to 30 June 2020).
Under 18: Different rules apply to workers under the age of 18. If you’re under the age of 18, you must work at least 30 hours each week AND be paid at least $450 (before tax) in a calendar month to be eligible for Superannuation Guarantee (SG). A calendar month is, for example, the month of March or April etc rather than a 30-day period.
Aged 18 years or over: Any employee aged 18 years or over must earn at least $450 a month (before tax) to be entitled to the 9.5% SG contributions (for 2018/2019 year, or for the 2019/2020 year). For employees aged 18 or over there is no requirement to work a minimum number of hours, unless the employment relates to work of a private or domestic nature, such as babysitting or house cleaning. In these specific private or domestic circumstances, such an individual is entitled to SG if they work at least 30 hours each week and earn $450 a month.
You can also check with your employer about your SG entitlements, if any. For more information about your SG entitlements, including entitlements for previous years see SuperGuide article Superannuation and employees: 10 facts about your super entitlements.
What happens to my employer’s superannuation contributions?
If you’re entitled to Superannuation Guarantee (SG), your employer must pay those super contributions into a superannuation fund, at least quarterly (and often monthly), and by certain deadlines.
In most cases you will be entitled to choose your superannuation fund. If you’re eligible for SG, and you’re eligible to choose your own super fund, then your employer must give you a Standard Choice Form to enable you to choose a super fund.
If you don’t make a choice, then your super contributions are paid into a super fund chosen by your employer, or in some cases, paid into a super fund specified in an industry agreement or award. If you don’t make a choice, the super fund that your SG contributions will be paid into, will be a MySuper product. You can find out more about MySuper products by referring to our SuperGuide article MySuper: 113 super funds now available.
In the first instance, you can ask your employer for the name of the super fund where your employer’s super contributions (made on your behalf) are paid.
The superannuation fund must be a ‘complying’ super fund. What this means is that the super fund follows special super rules and lodges annual returns. Most super funds must also be registered with the Australian Prudential Regulation Authority (APRA). You can check that a super fund is registered by APRA by using Super Fund Lookup, which is a service run by the Australian Tax Office (you can find Super Fund Lookup by clicking here).
If you find the super jargon above a bit overwhelming, for an explanation of some of the most common terms, check out the SuperGuide article Super for beginners, part 22: How do you speak ‘superannuation’ (… in 25 words)?