Commission only ageny paying her own Super guarantee | ATO Community

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(I'm new)I'm new

7 June 2023

I employee a Real Estate Agent who is employed on a Commission only agreement that includes paying her own 10.5% super guarantee. How do I calculate her 10.5% from her commission. I understand that Salary Sacrifice is deducted from gross before Tax which the Agent pays but how do I calculate and where is the 10.5% deducted from that she is paying, not me the employer. This is common in the RE industry. Really appreciate your help with this-no one seems to know.

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(Taxicorn)Taxicorn

8 June 2023

I employee a Real Estate Agent who is employed on a Commission only agreement that includes paying her own 10.5% super guarantee.

You cannot contract out of your SG obligation - the only way this can work is if you pay the contractor less and then pay SG yourself.

Maybe this is what you mean ?

If commission = $ 1000 incl 10.5% super

Then contractor receives 905

You pay SG $ 905 x 10.5% = 95

Total 1000

If contract says contract has to pay super personally, then you need a lawyer to redo the employment contract.

You should also consider the workers comp position in your State.

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Most helpful reply

(Taxicorn)Taxicorn

8 June 2023

I employee a Real Estate Agent who is employed on a Commission only agreement that includes paying her own 10.5% super guarantee.

You cannot contract out of your SG obligation - the only way this can work is if you pay the contractor less and then pay SG yourself.

Maybe this is what you mean ?

If commission = $ 1000 incl 10.5% super

Then contractor receives 905

You pay SG $ 905 x 10.5% = 95

Total 1000

If contract says contract has to pay super personally, then you need a lawyer to redo the employment contract.

You should also consider the workers comp position in your State.

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Liked by Peter_Clyne

(Superuser)Superuser

8 June 2023

And the formula you need is :

Commission = 1,000 / (1 + 10.5%)

= 904.98 , say ~ 905

And Payroll tax if annual national payroll exceeds $1.2 millions

+1 for @Bruce4Tax

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Liked by Peter_Clyne and Bruce4Tax

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Commission only ageny paying her own Super guarantee | ATO Community