superannuation for employees under 18

Amir Member Posts: 2

As you know, for employees under 18, superannuation payment is mandatory if they work more than 30 hours a week. My employee is under 18 and works less than 30 hours a week, so I don't need to pay superannuation for him. Still, the payroll system doesn't let me remove superannuation payment manually and report it to the ATO. It can cause penalties for me as the company director. Could you please let me know how I can manually change the superannuation payment to Nil?



  • swakhlu01 .
    swakhlu01 . Member Posts: 483 Payroll App Expert Payroll App Expert
    edited June 2022

    @Amir If the employee is not earning more than $450 a month then the Payroll app will not calculate any super as per current rules. However, considering the Payroll app is calculating super guarantee for this employee one has to assume the earnings are more than this amount.

    You should be able to create a special earnings category and mark NIL super guarantee. Call it "employee under 18 year". Create the payrun using this Earnings category and Super will not be calculated. You can then submit this to ATO.

    Make changes in Payroll settings as suggested -

  • Amir
    Amir Member Posts: 2

    Thank you. That was an excellent guide, and I could solve the problem.

  • kenl90
    kenl90 Member Posts: 48 ✭✭

    I don't think the above is an appropriate solution. From 1-Jul-22, the ATO rule, is based on the hours worked (=> 30 hours for staff under 18 yo); not the gross amount earned. I have logged a support call for this.

    My workaround is to create a new SGC Pay item called SGC(under 18) and use the "Threshold Amount" of $450 as a temporary measure to resolve this. I have a few casuals who are under 18 and their rates are from $10 to $15.69. Based on 30 hours criteria, the threshold amount ranges from $300 ($10 x 30) to $470.70 ($15.69 x 30)

  • swakhlu01 .
    swakhlu01 . Member Posts: 483 Payroll App Expert Payroll App Expert

    @kenl90 you are correct. The solution at the beginning of this post was only for the rules current in the last financial year as indicated there.

    However, as the $450 per month threshold rule for super guarantee no longer applies from 1st July 22, the under 18 superannuation eligibility can be easily applied in the Payrun using the two earnings items -

    • one with < 30 hours per week having NIL super applied, and
    • other with ">" 30 hours per week with super guarantee applied.

    I understand the $450 threshold for payruns since 1st July has already been removed in the new update of the Payroll app.

  • Rav
    Rav Administrator, Reckon Staff Posts: 15,087 Community Manager Community Manager

    Hi all,

    Now that we're in the 2022/23 financial year the older info at the top of the thread is now outdated. The Payroll App has been updated to accommodate the current tax tables, removal of super guarantee threshold and super guarantee default rate. More info in the post below.

    In relation to employees under 18 who are working less than 30 hours per week, I'd echo @swakhlu01 .'s suggestion above. You can create a custom earnings item in the Payroll App specifically for this situation with the option to 'include in super guarantee calculation' unticked. Use this earnings item in your pay runs for employees under 18 who have worked less than 30 hours and there will be no super calculated.

  • kenl90
    kenl90 Member Posts: 48 ✭✭

    Thanks, Rav and @swakjlu01. I'm aware of the proposed solution and have implemented it. However, I'd suggest that this is a workaround. Almost all my staff are casual and can be called to work anytime, although most of the time it will be <30 hours. However, there's a possibility that they may work for more than 30 hours on any week. The suggested solution requires me to be vigilant when I do my pay run to consider all under 18 and hours worked for the week. Just something to consider in a future upgrade.

  • GlynisFNQ
    GlynisFNQ Member Posts: 26 ✭✭

    Hi @Rav

    Following on from this thread... I have a similar situation to @kenl90 above.

    What is your suggestion for the casual employees (under 18) who's hours differ each week - sometimes above 30 vs sometimes less than 30.

    Is it possible to have 2 payroll items listed in their employee details? One for 'regular' SA contributions when they work 30 hrs +, and one for when super doesn't apply.

    I am finding that if I'm not vigilant, I am paying 10.5% Super unnecessarily, as I have realised this Quarter, unfortunately...


    Glynis :)