Issue
Whether the Commissioner can waive the Superannuation Guarantee Charge (SGC) if superannuation contributions are made after 28 July in the following year of income.
Decision
No, the Commissioner cannot waive the Superannuation Guarantee Charge (SGC) if superannuation contributions are made after 28 July in the following year of income.
Facts
The taxpayer is an employer who made insufficient superannuation contributions to a complying superannuation fund for an employee for the years ended 30 June 1993 and 30 June 1994. The taxpayer wishes to have contributions which were made to the fund on 3 October 1993 count for SGC purposes for the year ended 30 June 1993.
Reasons For Decision
Section 5 of the Superannuation Guarantee Charge Act 1992 levies the superannuation guarantee charge on all superannuation guarantee shortfalls of employers. Section 6 of the Superannuation Guarantee Charge Act 1992 provides that the amount of the SGC payable is equal to the amount of any shortfall in contributions.
Subsection 23(6A) of the Superannuation Guarantee (Administration) Act 1992 allows an employer to reduce the amount of the shortfall to nil. The employer must make superannuation contributions for employees at the prescribed rate based on the appropriate earnings base to a complying superannuation fund by 28 July in the following year of income if it is to count for the relevant year. With respect to contributions in the 1993 year only, contributions could be taken in to account under subsection 23(6) of the Superannuation Guarantee (Administration) Act 1992 if they were made on or before 14 August 1993.
The Commissioner has no discretion to overlook failure to meet this requirement.
In this case, the Commissioner cannot reduce the SGC for the year ended 30 June 1993 as the superannuation contributions were not made on or before 14 August 1993. However, the contributions can be used to reduce the amount of the shortfall for the year ended 30 June 1994 as they were made before 28 July 1994.