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  • Preventing inadvertent concessional caps breaches by certain employees

    In the 2018–19 Budget, the Australian Government announced that eligible individuals will be able to choose to nominate their wages from certain employers would not be subject to the superannuation guarantee (SG).

    Individuals with more than one employer, who expect their employers' compulsory super contributions will exceed their annual concessional contributions cap for a 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.

    From 21 October 2019, eligible individuals will be able to download an application form from ato.gov.au. If a form is required prior to this date please call 13 10 20.

    Applications are to be submitted at least 60 days before the start of the quarter for which the exemption is sought. .

    The Commissioner has extended the lodgment period for the quarter commencing 1 January 2020 only, and will accept applications lodged on or before 18 November 2019.

    The application form provides the Commissioner with information required to make an assessment including:

    • which employers the exemption certificate will apply to
    • the quarter(s) in the financial year for which the exemption is sought.

    Exemption certificates may be issued for multiple quarters within a financial year but cannot cover more than one financial year.

    If approved, the individual and their exempted employers will receive an 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.

    The exemption certificate does not prevent the employer from making super contributions on behalf of the employee. The only consequence of having a certificate is that the employer will not need to make SG contributions to avoid liability for the SG charge.

    The certificate does not change the employer's obligations under a workplace award or agreement, or an employer's agreement with their super fund.

    Employees are encouraged to talk to their employers before making an application as the take-up of this arrangement and any changes to their pay and other entitlements need to be negotiated between the employee and their employers.

    Legislation and supporting material

    The Treasury Laws Amendment (2018 Superannuation Measures No. 1) Bill 2019External Link has passed both Houses of Parliament and is currently awaiting royal assent.

    See also:

      Last modified: 01 Oct 2019QC 55371