SME Communicator - March 2011

Payment of your employee's super fees and insurance premiums

If you have an agreement with a super fund to reimburse costs such as administration fees and insurance premiums charged by them, these amounts are concessional (pre-tax) super contributions and will count towards your employee's concessional contributions cap.

The concessional contributions cap for 2010-11 is $25,000 or, if you are 50 years old or over, $50,000.

Letting your employees know that fund expenses have been reimbursed into their super will help them manage their contributions and may prevent them from inadvertently exceeding the annual concessional contributions cap and paying extra tax.

For more on the current contributions cap amount and excess contributions tax, refer to Super contributions - too much super can mean extra tax. For general information about employer contributions and salary sacrifice, visit Employers superannuation - home.