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Friday, 30 November 2012

Super guarantee contributions for individual employees are capped

  1. Superannuation guarantee (SG) contributions are compulsory superannuation contributions made by employers on behalf of their employees. Currently, employers must contribute the equivalent of 9 per cent of an employee’s salary into their superannuation fund.
  2. These contributions are generally required if an employee is aged between 18 and 69 inclusive and their wage before tax exceeds $450 per month [note that the age limit of 70 will be removed from July 1, 2013].

    The maximum amount of SG required is determined using the maximum super contribution base threshold. This threshold specifies the maximum of an individual employee’s gross earnings on which SG has to be paid for each quarter of any financial year.
  3. The maximum super contribution base is indexed in line with the average weekly ordinary time earnings (AWOTE) each income year and the new indexed amount is generally available each May.

    Following is a list of thresholds for the current and earlier financial years:
Income year
Per quarter
2012-13
$45,750
2011-12
$43,820
2010-11
$42,220
2009-10
$40,170

  1. Thus, for the 2012-13 year, the maximum compulsory SG contribution required to be made on behalf of an employee earning over $45,750 per quarter is $4,118 per quarter.

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