The Real Cost of Paying Super Late

Missing a superannuation payment deadline can result in significant and often unexpected consequences for employers. This applies whether your superannuation is processed by us, managed internally, or handled by another provider.

Many late payments are unintentional and often caused by timing assumptions, cash flow pressure, or clearing house delays. However, even a short delay can trigger penalties, extra administration, and lost tax benefits.

So, what happens when super is paid late?

Superannuation Guarantee Charge (SGC)

If a superannuation payment is late, the ATO requires an SGC statement to be lodged. This applies to all employers, regardless of who processes the superannuation. The SGC includes:

• The original superannuation amount owed

• Superannuation recalculated to include any overtime earnings

• 10 percent interest, calculated from the original due date until the SGC statement is lodged

• An administration fee of $20 per employee, per quarter

  
  

Even if the superannuation is eventually paid, these charges still apply once the payment is classified as late.

Loss of Tax Deductibility

If superannuation is paid late, the amount for that quarter is no longer tax deductible. This can significantly increase the real cost to your business.

Example:

A business pays $12,000 in superannuation for the quarter, but the payment is made late. Although the super is paid to employees, it is no longer tax deductible.

At a 25% company tax rate, this results in an additional $3,000 in tax, before factoring in interest, administration fees, and the cost of lodging an SGC statement.

Additional Charges for SGC Statements

Where an SGC statement needs to be prepared and lodged, additional work is required to calculate the amounts, prepare the documentation, and submit this to the ATO.

If we are engaged to assist with this process, additional fees will apply to cover the extra work involved. We will always discuss this with you before proceeding.

What We Are Seeing Right Now

The ATO is currently increasing its focus on superannuation compliance. We are seeing cases where employers are being asked to lodge SGC statements for payments that were only a few days late, as well as reviews going back up to two years.

Importantly, interest continues to accrue until the SGC statement is lodged, not until the superannuation is paid. This can result in significant interest charges if late payments are identified well after the original due date.

Would you know if a super payment from last year was processed late by a clearing house?

How to Reduce the Risk of Late Superannuation Payments

These recommendations apply to all employers, regardless of who manages superannuation processing.

• Approve Payments Early

Where superannuation is paid via a clearing house, we recommend approving payments by the 10th of the month they are due. This allows time for processing and for any employee detail issues to be resolved before the ATO deadline.

• Treat Superannuation as a Fixed Obligation

Superannuation should be built into cash flow planning as a non-negotiable expense. This reduces last minute pressure and lowers the risk of accidental late payments.

• Review Payment Timing Regularly

Even when superannuation is handled internally or by another provider, regularly reviewing payment dates and amounts can help identify issues early.

If superannuation processing forms part of your services with us, we actively monitor obligations and payment timing as part of your bookkeeping support. If superannuation is managed elsewhere, we are still happy to:

• Review past superannuation payments

• Help identify any late submissions

• Explain your obligations and next steps

A proactive review can help minimise interest, penalties, and unnecessary stress. If you have any questions or would like us to check your superannuation history, please reach out to our team.

Disclaimer: This article is intended to provide general guidance and is not specific advice. We encourage you to seek tailored advice for your circumstances.