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New super guarantee exemptions available from next year

High-income earners with multiple employers can apply to opt out of receiving superannuation guarantee (SG) payments from some employers to avoid unintentionally exceeding the concessional contributions cap from next year.

Tax&Compliance Grace Ormsby 10 October 2019
— 1 minute read

In a new information sheet, the Australian Taxation Office (ATO) has outlined that an individual may be able to opt out where they have more than one employer and they expect their employers’ mandated concessional super contributions to exceed the concessional contributions cap for a financial year.

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To opt out, the ATO is advising individuals who think they could be exempt to submit the “SG opt out for high-income earners with multiple employers” form to apply for an SG employer shortfall exemption certificate.

This certificate will release one or more of your employers from their SG obligations for up to four quarters in one financial year, although the ATO has reminded interested individuals that they will still need to receive SG contributions from at least one employer in each quarter.

Since the measure will begin from 1 January 2020, the ATO said it will be giving employees time to make applications for the remainder of the 2019–20 year.

Lodging must be done on or before 18 November 2019 for the third quarter commencing 1 January 2020, while lodgements for the fourth quarter (commencing 1 April 2020) must be done before 31 January 2020.

According to the Tax Office, the exemption certificate means an employer “will not be liable for the super guarantee charge if they don’t make SG contributions on your behalf for the quarters covered by the certificate”.

It has urged high-income earners considering such a move to talk to their employer before applying, “as they can choose to disregard an exemption certificate and continue to make SG contributions”.

In closing, the ATO outlined that such a measure “may not benefit everyone who’s eligible”.

Consider your employment arrangements, such as how pay or other entitlements may change and the effect of a relevant award or workplace agreement applicable to you.

An accountant or tax agent may also be able to provide advice.

New super guarantee exemptions available from next year
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