If you fail to meet the quarterly SG tax deductibility deadline, you are required to provide an SG Statement the following month, and you will have to pay the SG Charge to the Australian Taxation Office (ATO). The SG Charge is a non tax-deductible payment, which includes:
- the SG Shortfall
- 10% p.a. interest (calculated on a daily compounding basis), and
- a $20 administration fee per quarter per member.
If you pay the SG contributions after the quarterly deadline but before your original assessment for that quarter is made, you may elect (by completing the Superannuation Guarantee Charge Statement – a quarterly form located on the ATO website) to use those contributions to reduce the amount of the SG Charge that you must pay.
You can only use late contributions to offset the nominal interest and super guarantee shortfall components of the SG charge. You will not be able to offset the administration fee, or other interest or penalties.
If you elect to offset your SG Charge with your late payment to the super fund, then:
- the late payment is not tax deductible for income tax purposes
- you cannot revoke the election to use the offset, and
- any late contribution you use to reduce the amount of your SG Charge cannot be used as a pre-payment for current or future periods.
An election to use a contribution as an offset can be made in either:
- the first statement for the quarter, or
- within four years after the employer’s original assessment for the quarter is made.
Payment after the SG tax deductibility deadline to Media Super does not extinguish your liability to pay the SG Charge to the ATO.