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Super funds ‘source of truth’ on SG
The once a year reporting requirement between superannuation funds and the Australian Taxation Office (ATO) on superannuation guarantee (SG) compliance represents a genuine impediment to the timely and efficient identification of non-payment, according to specialist payroll firm, Automatic Data Processing (ADP).
ADP referred to superannuation funds as being the “source of truth” about whether employers were actually meeting their obligations and whether SG contributions were hitting member accounts.
In a submission to the Senate Economics References Committee inquiry into non-payment of the SG, ADP pointed to both the benefits and problems which would be associated with the Government moving to more frequent SG reporting, including monthly and pay-cycle reporting.
“From discussions with the ATO and superannuation industry representatives, there has been an investigation into how more frequent reporting from superannuation funds will help facilitate SG compliance,” the submission said. “As the current superannuation reporting mechanism between the superannuation funds and the ATO is a once a year reporting requirement, it does not help identify SG non‐payment in a timely and efficient manner.”
The submission said ADP felt that superannuation funds reporting on a more regular basis was “the missing link to enabling Government a definitive picture of employers that are not meeting their SG obligations”.
“Ultimately, superannuation funds are the ‘source of truth’ as the contribution is not paid and available for the member to use and invest until such time as it has hit their member account with their chosen fund,” it said.
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