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Retirement

Tax man given new super powers

By Reporter · August 29 2017
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Retirement

Tax man given new super powers

By Reporter
August 29 2017
Reading:
egg
egg
egg
Superannuation, super guarantee, superannuation guarantee, retirement savings, retirement planning, wealth management, ATO, Australian Taxation Office, Kelly O'Dwyer

Tax man given new super powers

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By Reporter · August 29 2017
Reading:
egg
egg
egg
Superannuation, super guarantee, superannuation guarantee, retirement savings, retirement planning, wealth management, ATO, Australian Taxation Office, Kelly O'Dwyer

The Australian Tax Office will receive new powers to ensure Australian employers are meeting their superannuation guarantee obligations.

Kelly O’Dwyer, the Minister for Revenue and Financial Services, today announced that the government will implement a package of reforms to strengthen the ATO and close a legal loophole that previously allowed “unscrupulous” employers to avoid making guaranteed superannuation payments.

“Employers who deliberately do not pay their workers’ superannuation entitlements are robbing their workers of their wages. This is illegal and won’t be tolerated,” Ms O’Dwyer said.

Under the new reforms, super funds will be required to report on the contributions they receive at least once a month, increase the ATO’s recovery powers to allow them to seek court-ordered penalties in the most extreme cases, and see additional funding channelled into a task force to crack down on non-compliance.

“The Turnbull government is taking action to safeguard and modernise the SG so employers can’t hide from their legal duty,” said Ms O’Dwyer.

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“We will give all Australians confidence that the superannuation system is working in their best interests.”

The changes were welcomed by industry advocacy group Australian Institute of Superannuation Trustees (AIST), who said the reforms would help to fix the "massive problem" of superannuation underpayment. 

“Superannuation is deferred wages and, in a compulsory super system, members must receive their full entitlements," said AIST CEO Eva Scheerlinck.

"Importantly, this package of reforms includes strengthening employer penalties for non-compliance and enhancing the ATO’s power to deal with repeat offenders.”

The AIST, however, argued that more reforms were needed, especially with regard to the frequency with which employers are required to make super guarantee contributions on their employee's behalf.

Currently, employers are only required to make these payments on a quarterly basis, and Ms Scheerlinck said making this more frequent (either monthly, or more ideally in-line with when wage payments are made) would be a vast improvement on the present system. 

“Disappointingly, the package lacks this key reform; improved payslip reporting would help employees keep better track of their super payments by providing them with the ability to check that their super has actually been paid into their fund," she said.

"We believe this measure would have a significant impact for members. We will work with the government to bolster the efficacy of the package in this way."

Tax man given new super powers
Superannuation, super guarantee, superannuation guarantee, retirement savings, retirement planning, wealth management, ATO, Australian Taxation Office, Kelly O'Dwyer
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