The Australian Taxation Office clarified it’s position last year on whether or not leave loading is to be treated as ordinary time earnings. The outcome of this was that for almost all CMSolutions members leave loading is ordinary time earnings and is therefore subject to superannuation.
We had been waiting on the Federal government to pass legislation introducing an amnesty for employers to “catch up” their superannuation payments for periods prior to April 2018 before providing any more information.
This legislation has now been passed and signed into law. For periods prior to April 2018 employers can now report and pay the additional super that is due on the leave loading amounts without incurring administration fees or penalties. This amnesty expires on 7 September 2020.
The advice we have been given is that you should calculate the superannuation shortfall on leave loading from 1 January 2012. This period covers off the six year requirement that is applied to back pay calculations.
Below is the link to the ATO’s website that includes the details of what information you need to submit and the Excel spreadsheet that needs to be completed and sent to the ATO for the amnesty to be applied for:
If you would like CMSolutions to assist you with these calculations and lodgements, give the Finance team a call for a quote.