Many small business owners put their own superannuation at the bottom of their priority list, but it is a vital part of running your own business.
By taking action now, you can ensure you have a strong financial foundation for your retirement years.
Superannuation is one of the best routes to saving for retirement, and if you’re self-employed or work as a contractor, paying yourself super falls into your list of responsibilities.
A standard contribution of 9.5 per cent of before-tax income will allow you to plan for life after work.
Understandably, many small business owners prioritise other financial responsibilities over paying themselves super.
If you have been an irregular payer and have an low-balance account, since 1 July 2019 new laws (known as the Protecting Your Superannuation Package) require superannuation providers to report and transfer these accounts to the Australian Taxation Office (ATO).
On the other side of the coin, employers have also been put on notice by the ATO that payments of employee superannuation contributions are on their radar.
The ATO will have increased visibility over super payments from this year, with Single Touch Payroll requiring the vast majority of Australian businesses to lodge payment and superannuation information for employees in real time.
While the tax office recognises most employers are playing by the rules, their approach highlights an ongoing shift in enforcement activity, with new data sources enabling regulators to be much more proactive about ensuring compliance with the law.
The ATO website has information about superannuation, including how to set up your account, see ato.gov.au/super.
The SBDC website also provides information about superannuation, payroll and other tax and finance matters.