As an employer, it is compulsory to pay your eligible employees super guarantee (SG) at least 4 times a year.
The minimum SG rate you must pay for each eligible employee is 11% of their ordinary time earnings (OTE). This is scheduled to progressively increase to 12% on 1 July 2025.
Before you calculate how much SG to pay, you should work out if you have to pay super.
To work out how much SG to pay, you can use our calculator below.Super guarantee contributions calculator
The current super guarantee percentage is the minimum required by law. You may pay SG at a higher rate under an award or agreement.
To manually work out how much super to pay for a quarter, multiply your employee's OTE, based on salary and wages paid in the quarter (before tax), by the SG rate.
The SG rate applied is based on when you pay your eligible workers, not when they earned their income. If you're paying super at a higher rate, use that rate.
For employees who started during the quarter, work out their super based on any salary and wages paid in the quarter.
Example: working out minimum super contribution
Xuan employs Danni. During the July 2023 – September 2023 quarter of the 2023–24 financial year. Danni's ordinary time earnings are $15,000.
Xuan works out the minimum super contribution for Danni for the quarter:
- $15,000 × 11% = $1,650.
Xuan contributes $1,650 to Danni's super fund by the quarterly due date of 28 October 2023. If Xuan fails to do this, he will have to pay the super guarantee charge, which is more than the SG he would have paid.End of example
Example: working out correct super contribution rate – fortnightly pay period
Peter employs Sue. For the fortnightly pay period ending 30 June 2023, Sue's ordinary time earnings are $3,000. Peter pays Sue for this work on 3 July 2023. The minimum super contribution for Sue for the pay period is:
- $3,000 × 11% = $330.
Peter contributes $330 for the July to September quarter to Sue’s super fund by the quarterly due date of 28 October 2023.
The SG rate on the date the salary is paid applies. The SG rate increased to 11% on 1 July 2023. As Peter pays Sue after 1 July, the new rate is applied to calculate her SG.End of example
Example: working out the correct super contribution rate – monthly pay period
XYZ Pty Ltd employs Neil and pays him a monthly salary. Neil works from 22 June 2023 to 19 July 2023 and earns $6,200 in ordinary time earnings. XYZ Pty Ltd pays Neil for this work on 20 July 2023.
Even though some of the period Neil works is prior to 1 July, as XYZ Pty Ltd makes the payment after 1 July 2023, they need to calculate Neil's super based on the new rate of 11%.
The minimum super contribution for Neil for the pay period is:
- $6,200 × 11% = $682.
XYZ Pty Ltd contributes $682 for the July to September SG quarter. They ensure that it is received by Neil’s super fund by the quarterly due date of 28 October 2023.End of example
Ordinary time earnings (OTE) is the gross amount your employees earn for their ordinary hours of work (before tax). It includes:
- over-award payments
- shift loading
- annual leave loading
- some allowances
For information on which payments count as OTE, see our List of payments that are ordinary time earnings.
Your employee's ordinary hours are the normal hours they work unless their hours are specified in an award or agreement.
If you can't determine their normal hours of work (such as for casual workers), the actual hours the employee works are their ordinary hours of work.
The Fair Work Act 2009 definition of ordinary hours for workers not under an award or agreement caps them at 38 hours. This definition does not override the super laws above.
If you pay a contractor mainly for their labour, you calculate SG on the labour component of the contract.
Overtime payments are not OTE, provided the employee's ordinary hours of work are clearly identified.
If you can't distinctly identify overtime amounts, all the hours actually worked are included in the employee's ordinary hours of work.
The above rules also apply if the payments are calculated as an annualised or lump sum component of a total salary package. Overtime payments must be clearly identifiable, otherwise all hours worked are OTE.
You don't have to pay SG for your employee's earnings above a certain limit, called the maximum contribution base.
This maximum contribution base amount is indexed annually and is usually available before the start of the financial year. The income limit for the 2023–24 financial year is $62,270 per quarter.
The base does not apply to other mandated contributions, such as contributions you pay under an award.
Example: maximum contribution base for SG
Rory is the Marketing Manager of ABC Pty Ltd.
During the July–September quarter of the 2023–24 financial year, Rory's OTE is $70,000.
The quarterly maximum contribution base for 2023–24 is $62,270.
ABC Pty Ltd uses the maximum contribution base to work out the SG contribution for Rory for the quarter:
- $62,270 × 11% = $6,849.70.
Rory's OTE above $62,270 is ignored.End of example
You must pay super on back pay of amounts that are OTE, even if the employee no longer works for you. SG is calculated and payable based on when you make the payment of salary and wages. This is regardless of the period the back pay payment relates to.
If you don't pay, you'll be liable for the super guarantee charge (SGC).
Example: back pay for an employee that has finished employment
On 30 June 2023, Sue finishes her employment with company ZYX. In September 2023, ZYX realises the company has been underpaying its employees. The company needs to give Sue back pay of an extra 2% for the period 1 January 2023 to 30 June 2023.
ZYX must pay an SG contribution for the back pay by the quarterly due date of 28 October 2023. That is 28 days after the quarter in which Sue is actually paid.
Between 1 January to 30 June 2023, Sue’s OTE is $60,000. ZYX works out the total back pay amount for this period:
- $60,000 × 2% = $1,200.
ZYX pays Sue on the 6 September 2023.
The company calculates Sue's SG contribution at 11% of her back pay. This is because her salary and wages back payment was made after 1 July 2023, when the rate increased from 10.5% to 11%.
SG contributions must be paid on the back pay for the quarter that corresponds to the date of payment – in this case, the September 2023 quarter. The payment would usually be made to the fund the company paid Sue's last super contribution into.
The additional super contribution for Sue for the period is:
- $1,200 × 11% = $132.
If the company doesn't pay the minimum super on time to a complying super fund or retirement savings account, they will have to pay the SGC to us.End of example