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by: Sanj Ediris

Super Guarantee Increase Frozen Until 2021

Generally, employers must pay the correct percentage (as a minimum) of what each employee earns into the employee’s superannuation fund account. The super guarantee rate is the minimum amount you should pay. After years at 9% in July 2013, it was raised a quarter of a percent to 9.25% and a further quarter percent to 9.5% from 1 July 2014.

The plan was to raise the rate by half a percent per annum until it peaked at 12% in 2021. As a result of Clive Palmer and the abolition of the mining tax in the Senate, rates will now be frozen at 9.5% until July 2021 and then start their half-a-percent rise per annum.

The Australian Government is also changing the rule concerning older employees. In the past, employees over 70 years old were exempted from the Superannuation guarantee, however, it is now compulsory to pay Superannuation guarantee to employees over the age of 70.

Furthermore, interestingly from 1st July 2014 Super guarantee must be remitted electronically as cheque payments are no longer allowed.