This is the second instalment of a three-part series about upcoming changes to superannuation.
In the second of our three-part series covering changes to superannuation legislation and how small businesses will be affected, we will look at the removal of the upper age limit and the changed requirements for payslips. Some of the changes mentioned have already taken place, so if your business is not yet up to speed with them, you will need to update your systems and processes to make sure your business is in compliance.
Removal of upper age limit
Where previously compulsory super contributions stopped once an employee reached the age of 70, under the new legislation, there is no upper age limit – which means that employers will need to continue paying compulsory superannuation contributions as long as the employee is working. This is a move designed to encourage older workers to stay in the workforce longer.
This change is taking effect from July 1, 2013 and will affect businesses with older employees. You will need to make sure you are paying the compulsory superannuation contributions for any employees you have that are 70 or older.
Currently it is mandatory that payslips show the number of superannuation payments and the amount accrued to date. A number of changes to how superannuation payments are reported on payslips and group certificates took effect on July 1 2012. If you haven’t already, you will need to ensure that your employees’ payslips display the following information:
- The name of the super fund they are contributing to
- The dates of the next contribution to be made
- The amount of all the contributions made, including any upcoming payments
- The time period during which any contributions were made
Failure to provide this information on payslips can lead to penalties for your business. Your employees’ group certificates also need to be updated with the relevant information. These changes are designed to keep employees better informed about their super contributions, and allow them to identify any errors or insufficient payments before they go through. This is particularly important with the planned employer contribution increases that are due to take place over the next seven years.
As an employer, it is important that you make sure your payroll systems are updated to reflect these changes, so you can make sure you are in compliance, and don’t end up facing fines.