EMPLOYER SUPERANNUATION

This type of superannaution is available to every worker in Australia. Their is certain limitations of minimum monthly income and certain age constraints, but essentially it is mandatory under the Superannuation Guarantee Contribution legislation to pay into the employees superannaution account a sum of 9% of the employees gross salary. Provided by your employer, this is paid in excess of your yearly salary

New Wealth Directions specialises in helping you bring all your superannuation into one flexible account that has over 100 investmetn choices to suit your type of investment attitude.

Employee Superannuation: When you start a new job your employer will at some stage set up a superannuation account for you with the company superannuation fund. Your employer may have their own fund and run it themselves with a policy committee.
Other types of superannuation will be available through your employer. Take an interest in your superannaution that your employer sets up for you and discover your investment choices. Then ensure your selected investments are appropriate to your investment risk profile
 

Superannuation Guarantee Levy:- If you are employed and are earning more than $450.00 per month, you are entitled to employer superannuation.

The Superannuation Guarantee, which has applied from 1 July 1992, affects all employers. An employer must choose between providing superannuation support for their employees, or paying the Superannuation Guarantee Charge.

For the financial year 2011 - 2012 the level of support is ... 9% ... of your salary and wages. 

Superannuation Guarantee Charge:- If an employer does not make the minimum superannuation contributions for an employee or contractor by the 28th of July each year, then the employer is subject to the superannuation guarantee charge.

  • The SG charge is not tax deductible and includes the SG shortfall for the employee
  • a nominal interest component of 10%
  • a fixed administration fee of $50 plus $30 for each employee for whom there is a shortfall.

The SG shortfall:- in the case of late payment will be calculated based on the definition of salary and wages as opposed to ordinary time earnings. The employer must lodge a SG statement with the ATO by the 14th of August each year.
A penalty called the general interest charge applies if employers do not pay the SG charge by this date.
 

Industry Superannuation:- These types of funds are setup by your industry that you work in and usually are very low fee superannaution accounts, they vary in levels of service and quality of reputation.
A lot of employees end up with a number of Industry superannuation accounts and indeed other superannuation accounts over their working career. Account fees and Insurance premiums can inhibit your superannuation from increasing in value especially when you have several accounts and have little control over the investment choice in each account.
 

Salary Sacrifice:- This is an excellent way of accumulating wealth in a tax effective manner.
It essentially means that with the consent of your employer they will pay an amount into your superannuation account before they apply PAYG tax to your salary.
Their are certain areas of the tax law that says any Salary sacrifice arrangement must be entered into before you actually receive the tax benefit in your hands. Call the Australian Taxation Office to check your arrangement or go to the website of the ATO and search salary sacrifice, for more information:
Australian Taxation Office website