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Debtors and late-payers-the bane of every business owner. 

No matter how profitable your business is, it won't survive without good cash flow. If you can't pay your bills on time, you may end up trading while insolvent. And that's not just bad business-that's illegal. 

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Employers who don't pay super could face up to a year in jail

The Sydney Morning Herald has reported Employers who don't pay super could face up to a year in jail.

For the first time, employers who fail to follow the Tax Office's direction to pay super entitlements to their employees will be subject to court-ordered financial penalties as well as up to 12 months' imprisonment.

And directors of companies that don't pay super will come in for special attention with a "director identification number" to help the Tax Office identify those directors who are ripping off their employees.

Employers are legally required to pay 9.5 per cent in superannuation to every employee, including part time and casual employees, over the age of 18 earning more than $450 gross a month.

In 2015, the government had plans to reduce the penalties for employers who did not pay their employees' superannuation entitlements to very little.  

Under those proposals, which were part of its "reducing red tape for business" campaign, from the middle of 2016, all employers, not just small employers, would have been liable for a much smaller penalties, an administrative fee of less than $20 or $30 for each employee whose super entitlement was not paid.

The government's new approach is contained in its draft superannuation compliance bills that have just been released for consultation.

Super Guarantee Amnesty is coming to an end

SUPERANNUATION GUARANTEE AMNESTY – DO YOU HAVE UNPAID SUPER FOR EMPLOYEES?

The Government has announced an amnesty for employers that have fallen behind with superannuation guarantee (SG) payments to "self-correct". The amnesty applies to employers that have underpaid or not paid SG for any period from 1 July 1992 up to 31 March 2018. Under the amnesty, the penalties that normally apply to late payments are waived as is the administration fee, and the SG payment is deductible - normally employers lose the ability to deduct superannuation payments where SG is late.

The time period for taking advantage of the amnesty is due to end on 23 May 2019 and it will be important to identify any potential problem areas as soon as possible so that appropriate action can be taken.

If your business has engaged any contractors during the period covered by the amnesty, then the arrangements will need to be reviewed as it is common for workers to be classified as employees under the SG provisions even if the parties have agreed that the worker should be treated as a contractor. You cannot contract out of SG obligations.

If you have not undertaken a payroll audit or an audit of rates paid to employees, you should do this within the next 12 months.

The amnesty applies to voluntary disclosures. The amnesty does not apply to amounts that have already been identified as owing or where the employer is subject to an ATO audit.

Single Touch Payroll

The extension of Single Touch Payroll to employers with 19 or less employees has finally passed both Houses today, after late amendments were tabled in late last year.

 

The Treasury Laws Amendment (2018 Measures No. 4) Bill 2018 secured passage today after it was referred back to the House of Representatives last December due to proposed amendments to other measures contained in the same bill.

This will mean that employers with 19 or less employees will have to report under STP rules from 1 July 2019. Businesses with 20 or more employees began reporting from 1 July 2018.

 

The ATO have pre-empted the passage of legislation by contacting small business clients, informing them that they can start reporting if they have STP-ready software and to inquire with their tax practitioners if they have any questions.

 

It is now time to make sure you are STP compliant and ready to meet Tax Office requirements.  Although this is another time consuming compliance obligation, technology has now improved to a point where we can really achieve some significant productivity improvements particularly if you are doing things manually or use the old desktop programs.


Call us on 07 5439 1600 or email us at support@completebusiness.com.au to discuss your payroll options and see how much time we can give you back in your day.

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