The end of the financial year is fast approaching. There are some important changes to superannuation that come into effect from 1 July 2022 which all businesses need to be prepared for.
Minimum Earnings Threshold
Currently, an adult employee must earn a minimum of $450 per month before super guarantee is payable on their wages. From 1 July 2022, this minimum eligibility threshold is being removed. You will need to pay super guarantee on all earnings for adult employees.
For employees under the age of 18, they will still be required to work more than 30 hours in a week to be eligible for super guarantee.
Super Guarantee Rate
From 1 July 2022, the super guarantee rate is also increasing from 10% to 10.5%. This new rate applies to all payments you make to employees on or after 1 July. This is regardless if some or all of the pay period is for work performed prior to 1 July.
The super guarantee rate is currently legislated to increase by 0.5% each year until it reaches 12% from 1 July 2025.
For Xero payroll users, these changes will be automatically implemented in Xero from 1 July 2022. For other software, please refer to the provider. It is important to ensure these changes are implemented correctly in your system.
Other Important Dates for Super
In order to claim a tax deduction for super in the current financial year it must be paid prior to 30 June. Super is only deemed to be paid when it is received by the super fund. If you are using Xero for batch super payments, it is recommended that the batch be authorised and approved by 2pm AEST on Tuesday 14th June 2022.
If you have any questions regarding these changes to superannuation, or how to implement them into your business or software, book a discovery call today.