From 1 July 2022, the Superannuation Guarantee rate increases to 10.5% of ordinary time earnings. As well, the previous $450 per month earning threshold will be abolished, meaning that employer superannuation contributions will be required on all ordinary time earnings, irrespective of the level of monthly earnings.
The exception to these changes is for employees under 18 years old. They will still be required to work more than 30 hours in a week for employer superannuation contributions to be compulsory. While employers are not compelled to make superannuation contributions on behalf of any employees under 18 years old who work 30 or fewer hours in a week, nothing precludes an employer from voluntarily making such contributions.
In preparation for these changes, services should make the following changes in their payroll software. The changes should be made after the last June 2022 payroll has been finalised and before the first payroll in July 2022 is processed:
- Reset the calculation basis for superannuation guarantee to 10.5% of eligible wages.
- Reset the monthly threshold for superannuation payable on eligible wages to $0.
- Select / de-select as applicable any employees under 18yo, depending on the service’s policy on making contributions to young employees and the number of hours per week for which such employee(s) are engaged.