Changes to superannuation rates and policies are on the horizon that may affect how employers manage payroll and contribute to their employees’ retirement savings. Staying up-to-date with these changes is crucial to ensure compliance and avoid penalties. In this blog, we’ll explore the key superannuation changes for 2025, what employers need to be aware of, and how to stay on top of these important updates.
- Superannuation Rate Increase
One of the most significant changes employers will face in 2025 is the increase in the superannuation guarantee (SG) rate. From 1 July 2024, the SG rate was raised from 11% to 11.5%. This increase is part of a gradual rise, with the goal of eventually reaching 12% in July 2025.
For employers, this change means that you’ll need to adjust your payroll systems to ensure the correct superannuation contributions are made for each employee. For example, suppose you’re currently calculating superannuation based on the 11% rate. In that case, you’ll need to update your systems and processes to reflect the new 11.5% rate as soon as the changes come into effect. Employers will then be liable for Superannuation Guarantee Charge.
- Salary Sacrifice and Superannuation Contributions
With the SG rate increase, it’s also important to understand how salary sacrifice arrangements may be impacted. Salary sacrifice allows employees to redirect part of their pre-tax income into superannuation, effectively boosting their retirement savings. If your employees utilise salary sacrifice, ensure you are updating their contributions to align with the new SG rate.
Employers should also remind employees that salary sacrifice contributions are subject to the annual concessional contribution cap. If employees contribute more than the cap (which, for the 2025/26 financial year, is expected to be $27,500), they may incur additional tax penalties. Make sure you provide employees with clear guidance on how to manage their contributions.
- Payment Due Dates and Reporting Requirements
Employers must ensure that superannuation contributions are paid quarterly to avoid penalties. Under the current rules, superannuation payments must be made by the 28th day of the month following the end of each quarter. However, with the rate increase in July 2025, it’s essential to plan ahead and adjust payment schedules as necessary to accommodate for higher contributions.
Another important change employers will need to prepare for is the introduction of Single Touch Payroll (STP) Phase 2, which is set to become mandatory for all employers from 1 July 2025. This will require employers to report additional information, such as the breakdown of superannuation and allowances, to the Australian Taxation Office (ATO) directly from payroll systems.
- Compliance and Avoiding Penalties
Failing to comply with the superannuation guarantee requirements can result in significant penalties. Employers who do not pay the required superannuation by the due date may face the Superannuation Guarantee Charge (SGC), which is made up of the unpaid super, interest, and an administration fee.
To ensure you are compliant and avoid costly penalties, make sure to:
- Update your payroll systems to reflect the correct SG rate.
- Regularly review your payroll and superannuation contributions to ensure they are accurate and up to date.
- Pay superannuation on time – don’t miss the quarterly deadlines.
- Monitor employee salary sacrifice arrangements to avoid exceeding contribution caps.
- How to Stay on Top of Superannuation Changes
Given the complexities involved with superannuation compliance, it’s essential for employers to stay informed about any changes. Regularly reviewing updates from the Australian Taxation Office (ATO) and consulting with a qualified bookkeeper or BAS agent can help you manage these changes smoothly.
For peace of mind and expert guidance, consider contacting Katia Chehade, Master Bookkeeper and Registered BAS Agent at Sudoku Bookkeeping. Katia can help ensure your business stays compliant with superannuation changes and other payroll requirements, saving you time and reducing the risk of costly mistakes.
Don’t wait until the changes take effect—contact Katia Chehade today for a consultation on how to best prepare your business for the upcoming superannuation rate increases and reporting changes. Let us help you navigate these updates and keep your payroll systems running smoothly.