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Paying your employees’ super on time and to the right super fund is an important job for employers, but sometimes it can be overlooked.
If you miss a payment or don’t pay on time, you will have to pay the Super Guarantee Charge (SGC) and lodge paperwork with the ATO.
This can be a confusing process, so here’s SuperGuide’s simple explainer on what you need to do.
What are the SGC and SGC Statement?
If you do not pay super contributions for your employees by the quarterly due dates – or do not pay the full amount – you are required to pay an SG Charge (SGC).
You are also required to lodge an SGC Statement with the ATO. And to top it off, you are ineligible to claim a tax deduction for your SG contributions against your business income.
The SGC has three components:
- SG shortfall amount (including any choice liability), which is when you do not pay the full SG contribution for your employee. It is calculated using your employee’s salary or wages (not their ordinary time earnings)
- Interest on this amount,with thecurrent interest rate being 10%.
- Administration fee of $20 per employee, per quarter.
To report and rectify missing SG payments, you are required to lodge your SGC Statement by the due date (see below) and pay the outstanding SGC amount.
Even if you pay only a few days or weeks late, you still need to lodge an SGC Statement and pay the balance of the SGC.
Due dates for SG Charge and SGC Statement
When you make SG contributions on behalf of your employees, your payment must be made in full by the quarterly due date, which is 28 days after the end of each financial quarter.
If you don’t meet this payment deadline, you are required to lodge an SGC Statement and pay the SGC by the due date in the following calendar month (see table).
If you know you will be unable to lodge your SGC Statement or pay the SGC by the due date, you can apply to the ATO for extra time.
Applications for an extension must be in writing and state why you need the extension. They must also be received by the ATO before the due date. Nominal interest will continue accruing until you lodge, with the general interest charge applying from your deferred payment date to the day you pay the SGC in full.
|Quarter||Period||SG contribution due date||SG statement & charge due date|
|1||1 July – 30 September||28 October||28 November|
|2||1 October – 31 December||28 January||28 February|
|3||1 January – 31 March||28 April||28 May|
|4||1 April – 30 June||28 July||28 August|
Calculating the SGC
When you complete an SGC Statement, you are required to work out your own SGC.
Working out your SGC can be a little tricky, so the ATO provides some useful tools to help employers with their calculations. These include the ATO’s electronic SGC Statement Calculator Tool and an Excel spreadsheet version of the calculator. The spreadsheet version does not automatically calculate your SG shortfall amount, but does calculate the nominal interest component up to the date the form is completed.
Completing and lodging your SGC Statement
You can lodge your SGC Statement electronically using the SGC calculator in the ATO’s Business Portal or by completing the Superannuation Guarantee Charge Statement – Quarterly form.
To assist you, the ATO has a detailed information guide with worksheets (Completing your Superannuation Guarantee Charge Statement – Quarterly) available to help you work through the calculation process.
What if I make a late SG payment?
If you make catch-up SG payments to your employees’ super funds after the due date, you still need to lodge an SGC Statement and are still liable for the SGC.
You can, however, choose to offset your late payments against your SGC liability, or carry your late payment forward. There are time limits on both late payment options:
Option 1 – Late payment offset
Generally, you can offset a late payment amount for one of your employees against your SGC liability for the employee for the quarter if you have made:
- The late payment to your employee’s super fund
- The late payment before an SGC assessment is raised
- A late payment offset election within four years of the date of your original SGC assessment
- An election in the approved form requesting the contribution to be offset.
Option 2 – Carry forward your late payment
You can also choose to use your late payment as an SG payment for the quarter when it is paid, or for a future quarter.
This option is available if it is for the same employee and the start of the quarter is within 12 months of the payment date. Carry forward payments are tax deductible in the year you paid them.
Making your late payment election
If you intend to use the late payment offset option, you indicate this when you complete question 19 in your SGC Statement by ticking ‘Yes’.
When you choose the carry-forward option for your late payment, you tick ‘No’ at question 19 on the SGC Statement. This notifies the ATO you elect to carry forward the payment.
If you have already lodged an SGC Statement or received a SGC assessment, you need to lodge a Superannuation Guarantee late payment offset election form.