We’ve been hearing much of the changes to compulsory superannuation contributions effective 1st July 2013. But what exactly do the changes mean for individuals and how can you ensure you’re getting what you are entitled to? We asked Anthony Bell for advice on sorting super…
RESCU: What do we need to know?
Anthony Bell: In 2010 the Australian Government announced that the compulsory superannuation contribution rate was going to gradually increase from 9% to 12% by 2019, an eventual 33% increase in Superannuation Guarantee (SG) contributions. From the year commencing 1 July 2013, the minimum superannuation guarantee contributions required to be made for an employee will be 9.25% (up from 9%). Following this a further increase of 0.25% will be applicable from 1 July 2014. The SG contribution rate will then increase by 0.50% each year until 2019 from which point a rate of 12% will be maintained.
According to the Federal Government, the 33% increase in the SG rate will give a 30-year-old on average full-time wages and extra $108,000 in retirement savings just by turning up for work. If elected during the upcoming election the Coalition has stated that it will not repeal these changes.
RESCU: When will the changes take effect?
Anthony Bell: The changes to the SG contributions will begin on a gradual increase, effective 1st July 2013 and conclude on the 1st July 2019 at the proposed compulsory superannuation contribution of 12%.
RESCU: How can we discuss this with our employer?
Anthony Bell: It is important to ensure that your employer is aware of these new legislative changes. As of 1 July 2013, all employees should be encouraged to check that contributions are being made on their behalf at 9.25%.
RESCU: How can we ensure our super contributions are correct?
Anthony Bell: Along with the changes to superannuation guarantee payments, all employers will now need to report the amount and actual date of superannuation contribution payments on employee payslips. This is an important change as previously only employers covered by the Fair Work legislation were obliged to provide the super contribution details on the employee’s payslip. Along with compulsory contributions those who choose to make additional contributions such as; employers who process salary sacrifice or voluntary employee contributions will also be reported on the payslip. This change to regulation will be helpful for any employee wishing to track their super contributions and make sure that their employer is fulfilling their obligations.
By Anthony Bell, www.bellpartners.com
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