Updated on 18 June 2024
4 minute read
The super guarantee charge, or SGC, is a fine you get if you haven't paid your employees’ super on time and to the correct super fund. Learn how it works and tips to avoid it.
It’s your responsibility as an employer to follow super rules to help your employees build their retirement savings.
You must make sure to pay your employees’ super in full, on time, and to the correct super fund. If you don’t, you'll have to pay a fine called the SGC to the Australian Taxation Office (ATO).
The SGC applies if super guarantee (SG) contributions:
are paid late to an employee’s super account
are paid to the wrong super account
haven’t been paid in full
Unlike super contributions, the SGC is not tax deductible. You can only claim a tax deduction for employee super payments if they're paid on time.
Contributions are considered paid when the super fund gets them.
By law, employers must pay eligible employees SG contributions at least 4 times a year. This includes full-time, part-time and casual workers.
The minimum SG rate is 11.5% of an employee's ordinary time earnings (OTE)1 in 2024–25.
Super must be paid to eligible employees from the day they begin their employment. You'll need to do this by the quarterly super due dates.
You can choose to make payments more often, such as fortnightly or monthly. If you do, the total SG contribution for the quarter needs to be paid by the due date.
| SG Quarter | Date payment due | SGC & SGC statement due date |
|---|---|---|
| 1 July - 30 September | 28 October | 28 Nov |
| 1 October - 31 December | 28 January | 28 Feb |
| 1 January - 31 March | 28 April | 28 May |
| 1 April - 30 June | 28 July | 28 Aug |
If you're late paying super, you'll need to submit a SGC statement form to the ATO to calculate the amount you owe.
The due date for the SGC statement form and SGC payment to the ATO is one calendar month after the super guarantee due date.
It's a good idea to keep track of payment deadlines as late super payments and the SGC aren't tax-deductible. This means an extra cost to your business as you'll have to pay this charge out of your profits.
The SGC is more than the super you would have otherwise paid to the employee's fund. It's calculated on salary and wages you owe, which includes overtime and some allowances, rather than OTE. It also includes interest and other fees.
The SGC includes:
the shortfall amount if you've only paid some super or not at all
the choice liability if you didn't give your employees a choice of super fund or paid to the wrong super account
interest of 10% per annum
administration fee
If you've not paid an employee's super on time, in full and to the right fund, you'll need to submit a SGC statement form to the ATO. They will then calculate the SGC amount you have to pay based on the information you've given.
If you fail to submit and pay the SGC on time, the nominal interest will continue to grow. There may also be other administrative fines, which can be up to 200% of the SGC.
The ATO can also take legal action to get the unpaid money owed to employees.
Use the ATO's SGC calculator to work out if you need to pay the SGC for your employees and how much.
Follow these 5 tips to make sure you meet your super responsibilities. It shows your employees that you're invested in their future and are financially responsible.
For example, fortnightly or monthly. This gives you more time to find any issues ahead of the quarterly due date.
For new employees, make a super contribution after their first pay to check you have the right super account details.
Be quick to submit the SGC statement and pay the SGC amount. Extra fines may apply if you're late.
It can take up to 14 days for your clearing house to send payments to the right super fund, so plan ahead.
Use a secure employer payment portal and clearing house facilities to manage your super payments. Check our range of payment options to suit your business.
Find out more about paying super to protect the retirement incomes of your employees.
The SGC includes commissions, leave loadings and some allowances, but not overtime payments.
We'll accept SG contributions after the due date. But you'll still need to submit the SGC statement and pay the fine to the ATO.
If you're having trouble meeting your super responsibilities or are unable to pay in full, it's best to contact the ATO at ato.gov.au/sgc.
The ATO may do the following if an employer doesn't pay their SGC debts:
Australian Retirement Trust can help you with your super needs. This includes:
Visit our Employer Hub for more information.
It's quick and easy to choose us as your business partner. You'll have the tools to manage super and a dedicated team of employer specialists to support you.
Key changes to super will begin from 1 July 2024. See how they might affect you.
4 min read
Will you get super while on holiday? Let's see which types of leave are included for super, based on your earnings.
5 min read
If you want to retire well, you're not alone. Here's what to compare when deciding which super fund is best for you.
6 min read
1. OTE is the money earned by your employees' during normal work hours. It includes salary, allowances, loadings, bonuses, and some leave. Understanding what's included in OTE helps you to make sure you're paying the right amount of super.
