Legislation to remove the minimum income threshold for superannuation guarantee payments has passed.

From 1 July 2022 employers will be required to pay super guarantee contributions for all eligible employees, regardless of how much they earn in a calendar month.

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What is the change?

Currently, Australians earning less than $450 (pre-tax) per calendar month from a single employer are not covered by the super guarantee. So, an individual may have multiple jobs, earning less than $450 from each job and not be paid any super guarantee.

The changes are designed to make the super system fairer. They will help an estimated 300,000 lower-income workers to save for retirement.

What does it mean for my business?

Employers have an obligation to pay all eligible employees super guarantee. From 1 July 2022 eligible employees will include those earning less than $450 per calendar month.

If you already use cloud based payroll software, check that your provider is aware of the change.

If you process your payroll in-house, you need to update your processes to ensure that the new legislation is adhered to from 1 July.

If you have any questions please get in touch.

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