The superannuation guarantee (SG) is an integral part of ensuring Australians have enough money saved for their retirement. Knowing how this works and being mindful of any upcoming changes is essential for Australians as they plan for their future financial security. SG is your money and it’s important to know how this affects you and what you can do with it.
The superannuation guarantee is a mandatory payment set by the Australian Government that employers must make into their employees' super fund. As of 2022, employers must pay a minimum of 10.5% of an employee's ordinary time earnings into their chosen super fund. This contribution increases annually until 2025 when it will be 12%, so it’s important to stay up-to-date with these changes.
In addition to knowing about the annual increase in payments, understanding the taxes associated with SG can also be beneficial for individuals as they approach retirement. Currently, SG payments are taxed at 15%, which is lower than most people's marginal tax rate (the rate of tax paid on additional income). In other words, any additional funds you receive from SG contributions are likely to be taxed at a lower rate than if those monies had been earned through another source.
It's also important to understand that SG payments don't just benefit employees who are nearing retirement age - they can also benefit younger workers too. That's because any additional funds received now will have more time to grow, meaning larger savings later on in life. In addition, many Australians may also qualify for government co-contributions, which can add even more value to their nest eggs over time.
The superannuation guarantee increases by financial year
1 July 2022
1 July 2023
1 July 2024
1 July 2025
Should I be paid superannuation?
If you’re employed in Australia, and aged 18 or over then you are generally eligible to receive compulsory SG super contributions from your employer. If you’re under 18 but work more than 30 hours per week then you are also eligible. Contractors may also be eligible depending on whether they are considered employers for super purposes.
How to keep track of your super
If you’re an Crescent Wealth member then you can login to your Member Portal which allows you to view your most recent payments and balance as well as update personal details and make contributions if needed. It’s a good idea to keep track of all your payments and balances throughout the year so that you don’t miss out on any potential entitlements or benefits when it comes time for retirement planning.
What should I do if I’m not being paid super?
Talk to your employer first. If you’re unable to resolve your unpaid super query with them, visit the ATO website or call 13 10 20 for a step-by-step guide on how to recover missed or underpaid super.
From 1 July 2023 it's compulsory for employers to pay at least 11% of your salary to your super fund. These payments need to be made by quarterly deadlines set by the ATO.