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  • Preventing inadvertent concessional caps breaches by certain employees

    In the 2018–19 Budget, it was announced that eligible individuals can choose to nominate their wages from certain employers are not subject to the superannuation guarantee (SG) from 1 July 2018.

    Individuals with more than one employer, who expect their employers compulsory super contributions will exceed the $25,000 concessional contributions cap for the 2018/19 financial year, will be able to apply for an exemption certificate to release some of their employers from their SG obligations.

    Individuals will still need to receive SG payments from at least one employer.

    Once the law has passed and received Royal Assent, eligible individuals will be able to download an application form from ato.gov.au that will need to be completed and returned to the ATO for approval.

    It is anticipated that individuals will need to submit their applications 60 days before the start of the quarter the exemption will apply to.

    The application form will request all information required for the Commissioner to make an assessment including:

    • which employers the exemption certificate will apply to and
    • the quarter in the financial year to which it should apply.

    Exemption certificates may be issued for multiple quarters within a financial year and will not extend beyond the financial year in which they are issued.

    If approved, the individual and their exempted employers will receive a copy of the exemption certificate directly from the ATO. By issuing an exemption certificate the Commissioner will provide certainty for the employer as, once issued, the certificate cannot be varied or revoked.

    Employers can choose to not comply with the exemption certificate. The take-up of this arrangement and any changes to remuneration would need to be negotiated between the employees and the employers.

    Legislation and supporting material

    The Treasury Laws Amendment (2018 Superannuation Measures No. 1) Bill 2018External Link was passed by the House of Representatives on 20 June 2018 and is currently awaiting consideration by the Senate.

    See also:

      Last modified: 02 Nov 2018QC 55371