There are some important changes to super rules coming into effect on 1st July 2022.
Super Guarantee (SG) rate increasing to 10.5%
From 1 July 2022, the SG rate will increase from 10% to 10.5%.
That means, from the very first pay run that falls in July 2022, you must pay your employees 10.5% SG on their Ordinary Time Earnings (OTE), instead of the current 10%.
This will continue to increase by 0.5% every year until it reaches 12% in 2025.
Employers should be aware that these increases will increase employment costs of employees who are paid by the hour and salaried employees whose salaries are exclusive of superannuation.
Those employees whose salaries are inclusive of superannuation may only require an adjustment to their base rate, provided their employment contract allows for this and it does not drop their base rate to below minimum wage rates.
$450 monthly super threshold abolished
Another major change coming is the abolition of the $450 monthly minimum wage threshold to qualify for SG contributions.
Currently, you are not required to pay SG to employees who earn less than $450 per month (gross).
From 1 July 2022, this rule will be scrapped and SG contributions will apply to all employees (including casual and part-time) regardless of how much they earn.
The only exception to this rule is for employees under the age of 18, who are required to work more than 30 hours per week to be eligible for SG – irrespective of what they earn.
If you have any questions about how any of the above new measures may affect you or your business, please don’t hesitate to contact our office on 07 5532 4555 to discuss.