Superannuation Updates 1st July 2023

You may already know that starting on July 1, 2023, the Australian government will increase compulsory superannuation guarantee payments from 10.5% to 11%. To give you an idea of what this means for an employee earning $70,000 annually, this will increase their superannuation guarantee from $7,350 to $7,700 per year. It’s important to note that this guarantee will continue to rise in both 2024 and 2025 until it reaches 12%.

For a 30-year-old earning $70,000 per year, their superannuation will increase by $7,700 for the 2023/2024 financial year, $8,050 for the 2024/2025 financial year, and $8,400 for each financial year after that. If they work for 35 years, their retirement savings account (superannuation) will have $292,950 in contributions before any investment.

Under the superannuation guarantee, employers have to pay superannuation contributions of 11% of an employee’s ordinary time earnings when an employee is:
• over 18 years, or
• under 18 years and works over 30 hours a week.
If eligible, the super guarantee applies to all types of employees including:
• full-time employees
• part-time employees
• casual employees.
Temporary residents are also eligible for super.
Super has to be paid at least every 3 months and into the employee’s nominated account.
Whilst most software packages will provide for these updates, it is important that Business owners confirm that the changes have been made.