Compulsory superannuation for workers is a vital part of the Australian retirement income system. Introduced in 1992 and known as Superannuation Guarantee (SG), it’s a forced savings scheme designed to provide an income to Australians when they retire, separate to salaries and wages. 

Interesting Fact: When SG was introduced 31 years ago, the rate was a mandatory 3% (or 4 per cent for employers with an annual payroll above $1 million). Times have changed!

Fast-forward to 01 July 2023, the Super Guarantee minimum contribution rate will rise from 10.5% to 11%.

If your business has employees, you'll need to ensure your payroll and accounting systems are updated to incorporate the increase to the super rate. You can use the Australian Tax Office's Super guarantee eligibility tool to help determine which of your employees and/or contractors are eligible for SG contributions.

For salary and wage payments made on or after 01 July 2023, the new superannuation guarantee contribution rate of 11% will apply.

Super guarantee contributions for the quarter ending 30 June 2023 should be calculated at the old rate of 10.5%.

If you need help to work out how much super you need to pay your employees after 01 July 2023, you can use the Australian Tax Office's SG contributions calculator.

Looking ahead, the Super Guarantee rate is scheduled to progressively increase by 0.5% annually until it reaches 12% by 01 July 2025.

We're here to help

If you're unsure how the Super Guarantee increase on 01 July will impact your business – from an administrative or operational perspective and to your business' bottom-line – get in touch with your Accounting Adviser at The Peak Partnership for clarity-driven assistance.