Superannuation Eligibility: Do I need to pay?

Written By: Kelly Horsfield

This article will assist you in determining your superannuation eligibility.

Do I need to pay superannuation?

Generally, an employer is eligible and must pay super for an employee if:

  1. The employee is 18 years or over, and
  2. You pay them $450 or more (before tax) in regular income per calendar month.

OR 

  1. The employee is less than 18 years of age, and
  2. They work more than 30 hours per week, and
  3. You pay them $450 or more (before tax) in regular income per calendar month.

The superannuation guarantee must be paid regardless of whether the employee is full time, part time or casual, an Australian resident or here on a work visa.

Contractors who earn most of their income by providing a service to your business might also be eligible for super contributions from you.

What does ‘regular income’ mean?

The super contribution payment is based on an employee’s ordinary hours of work, which includes:

  • Regular wage
  • Commissions
  • Allowances
  • Paid leave
  • Shift loadings

It does not include:

  • Irregular overtime payments
  • Performance based bonuses
  • Termination payments

Superannuation Eligibility: Are there exeptions?

There are some exceptions:

  • You may be exempt from paying compulsory superannuation for employees over 65 years of age who have not worked (full or part-time) for at least 40 hours over 30 consecutive days in the financial year
  • There is also a maximum income per employee on which employers must pay the Super Guarantee. In 2015/16 it is $203,240 per year.

Now that you can determine your superannuation eligibility, this article will make sure you understand the key dates involved with superannuation payments.

If you have any further questions regarding superannuation requirements, feel free to book a consultation with one of our business advisers.


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