Significant changes to payroll are coming with the arrival of the new financial year. Most importantly, this includes changes to employee superannuation and redundancy packages.
Superannuation Guarantee Rate Increase
Most notably, the legislated superannuation guarantee (SG) rate will increase from 10% to 10.5%. From 1 July 2021 until 01 July 2025, the super guarantee percentage will increase by 5% each year until it reaches 12% in 2025. where it will hold. Moreover, depending on your payroll software, this may or may not automatically update. Software such a Keypay can detect changes such as this and will automatically accounts for in when the new financial rolls around.
It is important to be aware of your superannuation obligation to all employees and to factor in these yearly increases when looking at your budget forecasts. However, if you find this a bit out of your depth, contact Astute to have a chat about budget forecasting and how we can help you keep on top of the super guarantee changes.
Monthly Superannuation Threshold
In previous year, super guarantee was an employer’s obligation only after an employee have earned over $450 in a month. As of 1 July 2022 this is no longer the case. Furthermore, to calculate the super guarantee, an employer will use Ordinary time earnings (OTE). Employees will still need to satisfy other eligibility requirements, as these have not changed. Moreover, the ATO have a Super Guarantee Eligibility Tool to see if your staff are eligible.
This change may be automatically detected by your payroll software. With this in mind, a quick chat with your bookkeeper or payroll officer will ensure that this change is picked up in the new financial year.
Superannuation Contribution Base Increased
The maximum super contribution base (MCB) is used to determine the maximum limit on any individual employee’s earnings base for each quarter of any financial year. In fact, employers do not have to provide the minimum support for the part of earnings above this limit. Subsequently the MCB will increase to $60,220 per quarter from 1 July 2022.
Genuine Redundancy Cap Increase
The genuine redundancy cap has increased to $11,591 (base limit) from 1 July, 2022 and then $5,797 for each completed year of service;
How can Astute Help?
Astute CFO specialises in budget forecasting and reporting. A big factor when planning for yours business’ future is employee wages and super obligations. Astute will take the confusion out of the process and work with you to understand the what these changes will mean for you and your business. We have key focus on payroll processing, including superannuation, PAYG and everything in between. Contact us today to arrange an obligation free chat about how we can help your business today!
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