EOFY Super contributions
Hi Rav,
Just in regards to this information I received via email from Host Plus -
“For contributions to be counted in the 2021-22 financial year for tax purposes, they must be received by Hostplus by 30 June 2022. We are advising members to contribute by 24 June 2022 to ensure contributions are received before the end of the financial year.”
We make monthly contributions to Host Plus for our employees. How can I submit June’s payment before the month is finished?
Thanks, Vicki
Answers
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There is a warning, but there is no restriction in Reckon which prevents you from forwarding supn contributions to the funds before the end of the month.
Should not be a problem for monthly paid employees
The challenge is knowing your liability, especially for hourly paid people. There are many companies that experience this and have a small element of their supn conts carried over into the next year for tax purposes
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The super contributions have to be received by the fund by June 30th. The industry funds always struggle at the end of the year. The retail funds are worse. AMP is even worse than that.
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Exactly my point Bruce, how do I know what the liability will be? Many of our employees work O/T so their salary can vary week to week. Would it create problems if the super, as you say, is carried over into the next years tax? I don't want to get the company into trouble with non compliance of super rules.
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If the contributions don't reach the fund by 30 June then no rules are being broken. All it means is that Company tax deduction is deferred (not lost) until the next financial year. Squillions of companies fall into this category.
It is most definitely not a compliance issue. June contributions must be paid before 28 July before any compliance/penalty issues emerge.
If you don't know you what exactly your liability will be - do NOT guess, just recognise that the tax benefit will be deferred. (Unless you are the managing director and majority shareholder you are never getting paid enough to take the risks associated with guessing.)
PS Don't forget that the deferred tax deduction issue only emerges for contributions which haven't reached the fund, so in theory for a weekly based payroll we are only talking about 1/52nd of the annual superannuation bill which is not a large percentage of a company's annual expenses.
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Thank you Bruce. Much appreciated.
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