Superannuation Guarantee Increase
From 1 July 2022 the superannuation guarantee (SG) rate will increase to 10.5%, an increase of 0.5%. The super rate will increase by a further 0.5% each year until it reaches 12% in 2025.
What does this mean for employers?
Super guarantee is the minimum amount an employer must pay to avoid the super guarantee charge. The rate had previously been 9.5% since 1 July 2014 but will increase as follows:
|Up to 30 June 2021||9.5%|
|1 July 2021 to 30 June 2022||10%|
|1 July 2022 to 30 June 2023||10.5%|
|1 July 2023 to 30 June 2024||11%|
|1 July 2024 to 30 June 2025||11.5%|
|From 1 July 2025||12%|
Choice of Fund Rules
Please also ensure that you are compliant with the Choice of Fund Rules which came into effect from 1 November 2021. This means that where an employee commences employment but has not nominated a super fund, the employer is required to make contributions to the employee’s existing super fund (in circumstances where they have one). Employers will be able to check with the ATO to see if the employee has an existing super account.
The purpose of this change was to prevent employees having multiple super funds and excessive account fees. By ‘stapling’ the employee’s super fund to them, their account follows them from each job and overrides the employer’s nominated default fund.