We are fired up today, well Tim is, and Dan wants to be, but can’t muster the energy.
Training for a half marathon is taking its toll, Tim is ready to celebrate Lewi’s first lap around the sun and the guys delve deep into the Super Guarantee Charge and why it’s such a b*#%h.
If you have employees or are a business owner and also an employee of your business this ep is for you. Now is the time to focus on superannuation. In the past, it’s never been high on anyone’s list, particularly if you are self-employed. That has all changed. You need to start paying super each time you pay wages, pay the super, even if it’s for you. The fee’s resulting in paying late are excessive, and whilst you’re at it, now is the time to also move the tax withholding amount into another account. Thats not your money, you will need to pay it either in your next BAS or IAS, so save it now. To stop the stress of trying to find it later.
BULLET POINTS OF KEY TOPICS & CHAPTER MARKERS
- Tim & Danlow [1:30] Dan is the Running Man! He is prepping for his half-marathon in a couple of weeks, thanks to Orford Man on the Street for some needling and a rub down. Tim is in full party mode, Lewis, wait for it. Is One! He is One already, the first year of parenthood is behind him, and now it’s time to party.
- Business Update [8:26] As always, specialThanks to CATS Accountants for Sponsoring the Business Update. The Xero Half Year Results are in, but we aren’t delving into that this week, that’s just a teaser of next week’s ep. Today’s Business Update is more of a discussion, The Nepo Babies have raised a topic, that Dan feels strongly about. This came about as they like to frequent the local watering hole. They pay via card and get a surcharge. Is this moral? Is this right? Let us know your thoughts on this. We understand the need to cover the merchant fee, but do you? This is quicker and easier than using cash?
- Tim’s Tight Ass Tip [13:14] Bank fees are optional – If you ever get charged a bank fee, call them. In most cases if the fee is unfair, you will get the money back even a month later.
- Main Topic [15:25] The Super Guarantee Charge. Summary:
- In days-gone-by, it used to be that the ATO only knew about overdue or late super payments thanks to an employee of yours contacting them and dobbing you in.
- This is no longer the case, the ATO have all of the information they need at their fingertips. The days of getting away with paying super late (even just a day) are over.
- Also, the days of getting away with not paying your own or your spouse/children/family’s super are also over.
- Thanks to Single Touch Payroll and Superstream, the ATO have more visibility than ever of what you are paying your employees in wages, what you owe them for super, and whether or not you paid the super on time.
- So even if you pay your employee super a day late, a week late, a month late, you will be at a very high chance of that being noticed by the ATO.
- The ATO might see a late payment from you and ask you to submit a super guarantee charge statement.
- There are a number of reasons why this is bad for you:
- You can no longer claim a deduction for the super that was paid late
- You will be charged an administration fee of $20/employee per quarter
- You will be charged interest from the due date for payment of the super up until you submit the super guarantee charge form
- You may even have to pay more super to your employees as the ATO will require you to pay super on all wages (rather than the ordinary requirement of paying super only for ordinary time earnings – ie they will make you pay super on overtime wages too)
- As you can see it is now vital to be paying your superannuation on time, even if it is your own super.
- The solution?
- To help avoid all of this stress, just pay your employee super every time you pay wages. And while you are at it, set up another account for tax, move the tax withheld amounts into that account to prep for your next Activity Statement or Instalment Activity Statement. Because ultimately none of that is your money, so save it now, and you will avoid stress when it comes to paying for BAS’s/IAS’s and you can rest easy knowing you will never suffer through dealing with a pesky Super Guarantee Charge.
- Hot Tip, don’t forget: It can take 7 business days for your super payment to arrive in the superfund of your employee. The due date for payment is 28 days after the end of the quarter, but really that is the date by which super should already be in your employee’s superfund. Don’t get caught out thinking you can pay on the due date, as your payment will almost certainly be late if you do that.
- Mail Bag [26:40] We’ve got some feedback from the people, about their shutdown routines.
- Other Thing [29:28] Tim’s other thing is Block out blinds. He is loving life right now and getting such better sleep thanks to ScreenAway. Dan is watching a lot of NBA, Scottie Barnes is bringing him joy at the moment. So, shout out to Scottie for doing his thing.