How to meet your employer super obligations

10 super obligations to check off this financial year

The new financial year is a good time to check and confirm what you need to do to meet your employer super obligations. This not only helps ensure compliance and avoid unnecessary penalties or issues but helps foster engagement and the trust of your team, all the while enhancing their financial wellbeing and security.

Covered in this article:

1. Review your default super fund arrangements
2. Give your people the choice, and adhere to ‘stapling’
3. Check you’re contributing super to the right people
4. Be sure to contribute the right amount for different work situations
5. Contribute on time or be charged
6. Use a SuperStream service to make contributions
7. Regularly audit your record keeping
8. Claim your tax deduction
9. Know what insurance your employees can access
10. Enquire and meet with your fund regularly
     

1. Review your default super fund arrangements

A default super fund is a super fund you choose to make super contributions to, for employees who don’t have a fund ‘stapled’ to them or who don’t select their own fund.

So what are the requirements of a default super fund?

• A default super fund is also known as an ‘employer-nominated’ fund.
• It must be registered by the Australian Prudential Regulation Authority (APRA).
• It needs to offer a MySuper product (cost-effective super product with a basic set of features).
• It must provide appropriate and affordable insurance cover.
• It must offer adequate member services (support, online access, education).
• You must provide the default fund’s details on the ‘standard choice form’ that you provide to employees.

Read more about what features to look for in a default fund.

2. Give your people the choice, and adhere to ‘stapling’

Your employees – new or existing – are entitled to choose their own super fund, and you need to make sure they can easily access a standard choice form. Be sure to read more at the ATO website about offering employees a choice of super fund.

If your employees don’t choose a fund, your mandatory Superannuation Guarantee (SG) contributions need to go to their ‘stapled’ fund.

If your employees don’t have a stapled fund, your SG contributions need to go into an account you set up for them in your chosen default super fund.

‘Stapling’ and ‘stapled fund’

‘Stapling’ is a super reform aimed at simplifying super management. It helps avoid new super accounts being opened each time an employee starts a new job, in turn potentially reducing account fees, and encouraging member funds to be in one place to help enhance overall retirement savings growth.

A ‘stapled fund’ is an existing super account linked, or ‘stapled’ to an employee and follows them when they change jobs.

Visit the ATO website for more detail on stapled funds.

3. Check you’re contributing super to the right people

All full-time, part-time, and casual workers, aged 18 and over, regardless of how much they earn, are eligible for SG contributions. Any employees under 18 who work more than 30 hours a week are also entitled to super.

Certain exemptions to contributing SG apply, e.g. foreign executives and temporary residents.

Unsure? Try the ATO’s Super Guarantee eligibility tool.
 

4. Be sure to contribute the right amount for different work situations

You must contribute a percentage of your employees’ ordinary time earnings (OTE) into their super fund, and ensure you’re contributing the current SG rate for the financial year within which you’re making the contributions.

(It is worth being extra cautious when calculating the contribution amounts for employees with varied work hours and changing arranegements.)

• OTE includes regular salary/wages, some allowances, commissions, bonuses, shift loadings, penalty rates, and leave payments.
• OTE excludes overtime, expense reimbursement, and redundancy/termination payments. Read ATO information on OTE.

The minimum amount of SG per financial year is as follows:

• FY 2023/2024 – 11%
• FY 2024/2025 – 11.5%
• FY 2025/2026 – 12%

However, you’ll need to contribute more if your employee(s) choose to sacrifice some of their salary into super.

It is also important to be aware of the maximum super (quarterly) contribution base, where you don’t need to pay SG on earnings above a certain limit.
 

5. Contribute on time or be charged

You need to make your employee SG contributions at least quarterly, however from 1 July 2026 it is anticipated you’re going to have to make them the same day as you pay your employees in line with the government’s Payday super announcement.

It's important you make your contributions to the correct super funds, and by the quarterly cut-off dates to avoid having to pay a Super Guarantee Charge.

The Super Guarantee Charge includes unpaid super plus interest, and an administration fee.
 

Quarterly SG cut off dates

6. Use a SuperStream service to make contributions

You need to make your SG contributions via a service that is compliant with SuperStream – a government system that standardises the way super contributions are paid.

This helps to improve efficiency, ideally reduce errors, streamline the process of contributing super, and ensure associated data are sent in a consistent and simplified electronic way.
 

7. Regularly audit your record-keeping

The new financial year could be a good time to make sure your record-keeping is in order. You need to keep accurate records for at least five years, to make sure you can show you’ve met your employer super obligations.
 

You may want to do this for several reasons:
 

• Compliance – to make sure your super contributions are correctly calculated, paid on time, and in accordance to legislative requirements.
• Accuracy – to help identify and rectify any discrepancies or errors in payroll and contribution records.
• Trust – to demonstrate a commitment to accurate and timely contributions shows you value your employees’ financial wellbeing.
• Avoid penalties – super compliance breaches can result in significant penalties and charges. Regular audits can help detect issues early and allow for corrections.
• Prepare for external audits – being ready for potential audits by the ATO or other regulatory bodies can help prevent any business disruption.
• Financial management – accurate super records mean you can be fully aware of your business’ financial obligations, and it can help you better manage cash flow.
   

What records to keep?
 

• Contributions you’ve paid to every employee.
• How the contributions have been calculated.
• Proof you offered choice of fund.
• Details of anyone who isn’t eligible for super and why.
• Confirmation your chosen default fund offers a MySuper product.
• Confirmation that your employees’ super funds are receiving contributions.
  
  

8. Claim your tax deduction

Did you know you can generally claim a 100% tax deduction¹ for contributions you make to a complying super fund or retirement savings account for your employees and certain contractors?

To substantiate the deduction claim, you will need to ensure the contributions are made by 30 June to be deductible in that financial year, keep accurate record-keeping of payment dates, amounts, and recipient funds. In addition, the contributions can’t exceed the annual concessional contribution cap of $30,000 (financial year 2024/2025) per employee to avoid additional taxes.

Exemptions include contributions made to employees over 75, any made after the quarterly due date, and the Super Guarantee Charge if you’re late making SG contributions.
 

9. Know what insurance your employees can access

When your employees start working with you, and become a default super member, they may be eligible for automatic insurance cover.

The types of cover available to your employees will depend on your plan, but generally include death (including terminal illness), total and permanent disablement, and where available, income protection².

If employees are eligible, automatic insurance cover starts once they reach age 25, and their super account balance reaches $6,000, with premiums then paid from their super.
 

10. Enquire and meet with your fund regularly

It’s important to make regular enquiries with your super fund on performance and other matters.

If you have more than 50 employees you can consider establishing a Policy Committee, noting Policy Committees have specific requirements relating to elections, nominations and governance.

6 policy committee meeting considerations:
 

1. Talk with your super fund representative for guidance.
2. Nominate a person in charge of the meeting – usually from the fund.
3. Appoint employees to represent the membership.
4. Appoint team members who will represent your business.
5. Let your super fund know who the committee members are.
6. Hold the meetings regularly – e.g. quarterly, half-yearly or annually.