The ATO has confirmed it will waive penalties for businesses who voluntarily disclosed underpayment of superannuation in the wake of the ‘botched’ superannuation guarantee amnesty.
The amnesty was a federal government initiative that encouraged employers to ‘wipe the slate clean’ and pay workers their unpaid super entitlements. It proposed a waiver of the administration component, Part 7 penalty and the tax deductibility of all catch-up payments during the 12 month amnesty period.
But the amnesty failed to get through parliament meaning the tax office will now use it’s discretion to waive penalties for employers that came forward thinking they could apply for amnesty.
“Consistent with our existing approaches in other instances where people come forward voluntarily, when we receive these superannuation guarantee notifications, the fact that they have come forward to the ATO is a strong consideration in the level of discretional penalty applied”, an ATO spokesperson stated.
“In relation to superannuation guarantee, the ATO only has the discretion to remit the Part 7 penalty. With regard to those taxpayers who made a voluntary disclosure in anticipation of the proposed amnesty, we will remit the Part 7 penalty in full.”
Employers will still have to pay the superannuation guarantee they owe to their employee, the interest amount, and the $20 administration component per employee per quarter.
If you have self-reported and need assistance in this area please contact our office for advice.