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Payment of Superannuation on Lump-Sum Payments

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Newbie

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Hi, I am an Australian resident and I was hoping for some assistance. Three of the last five years my employer (a large finance company) paid my salary increase as a lump sum payment rather than as a percentage increase to my salary and I was advised on each occasion that payment of superannuation was not applicable. However, as I understand it, these payments are considered part of my ordinary time earnings (OTE) for super guarantee purposes and therefore superannuation should have been paid. Am I correct with my assumption?

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Hi @Chris80,

 

Thanks for getting in touch!

 

As @macfanboy has addressed - it would depend on your employment agreement/contract or award as to what is considered your ordinary time earnings. If you have a written contract and would like to discuss your situation further, you can contact our Early engagement team by submitting a request form or requesting a call back and an officer will contact you to discuss your situation further.

 

Thanks, JodieH.

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Taxicorn

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Hi @Chris80,

 

Thanks for getting in touch!

 

As @macfanboy has addressed - it would depend on your employment agreement/contract or award as to what is considered your ordinary time earnings. If you have a written contract and would like to discuss your situation further, you can contact our Early engagement team by submitting a request form or requesting a call back and an officer will contact you to discuss your situation further.

 

Thanks, JodieH.

Newbie

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Hi @JodieH and @macfanboy

 

Thank you for your reply.

 

My employer has confirmed that superannuation was payable on these 3 lump sum payments and has agreed to pay the applicable SG amounts.

 

We're not talking massive amounts here but given that these relate to previous financial years, should my employer be paying the SGC and interest on these unpaid amounts?

 

If so, are the penalties applied passed onto me or does the ATO keep these amounts?

 

Regards,

 

Chris80.

Community Support

Replies 0

Hi @Chris80,

 

Thanks for getting in touch!

 

If your employer has missed paying super entitlements on your behalf to your super fund, they'll need to lodge a Super guarantee charge (SGC) statement and pay the SGC amount to us.

 

Once received we'll process the form and payment and transfer the super guarantee shortfall amount and any interest to your chosen super fund. The administration fee is retained by the ATO. More information about the order of allocation of SGC can be found in attachment C (i) of PS LA 2011/20 Payment and credit allocation.

 

Thanks, JodieH.