The super guarantee is increasing to 9.50%

The Superannuation Guarantee (SG) rate will increase to 9.50% from 1 July 2014 (up from the current 9.25%).

SG contributions must be made on employee's ordinary time earnings (OTE) which is the amount an employee earns during ordinary hours of work. It will include elements like commissions, shift-loadings and allowances but not overtime payments.

Calculating SG contributions

You're required to calculate and pay employee SG contributions quarterly-that's every three months for each employee.

To calculate how much you'll need to pay simply multiply an employee's OTE for the quarter by the current SG contributions rate of 9.25% and pay the amount into the employee's complying super fund (and within 28 days of the end of that quarter).

After 1 July 2014 you'll need to use the increased SG contributions rate of 9.50% when calculating your quarterly SG contribution payments.

If you back-pay salary or wages to a former employee you'll also have to pay SG contributions on the back-pay amount.

It was announced in the May 2014 Federal Budget that the government proposes to keep the SG rate at 9.50% until 1 July 2018. It will then rise to 10% and by 0.25% each year thereafter as outlined in the table below.

Please note that keeping the SG rate steady at 9.50% until 2018/2019 is only a proposal. Current legislation stipulates that the SG rate will increase to 10% next July. We will keep you informed if this legislation is passed.

Financial Year Rate (%)
2013/2014 9.25
2014/2015 9.50
2015/2016 9.50
2016/2017 9.50
2017/2018 9.50
2018/2019 10.00
2019/2020 10.50
2020/2021 11.00
2021/2022 11.50
2022/2023 12.00

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