Superannuation Changes 2022
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First, let’s recap superannuation changes from 2021;
Super stapling came in effect
Increase to the superannuation contribution caps:
- Concessional contribution cap: Increased from $25,000 to $27,500.
- Non-concessional cap: Increased from $100,000 to $110,000.
- Maximum non-concessional contribution cap: increased from $300,000 to $330,000.
Rollout of Single Touch Payroll: all employers required to use STP and report their payroll information digitally.
Now that you are up to date, let’s begin with the new changes in 2022.
Superannuation Guarantee Increase
On 1 July 2022, the super guarantee rate will increase from 10% to 10.5%. The main aim for the increase is to create a better retirement for all Australians.
All employers need to ensure their payroll systems reflects this change.
Employers that fail to increase the super guarantee for their employees, will have to pay a penalty (Superannuation Guarantee Charge). The penalty not only includes the Super Guarantee amounts owing but also interest and an additional administration fee.
For further information visiting the ATO website.
Changes to the Current Work Test
On 1 July 2022, the work test for people aged between 67 – 74 will be abolished.
In accordance with the current work test, to determine whether an individual can make super contributions (before or after tax), an individual must be employed for a minimum of 40 hours in a consecutive 30-day period during the financial year.
Now, Australians aged under 75 will no longer have to meet the work test to make contributions to their superannuation.
For more information, visit the ATO website.
$450 monthly income threshold
From 1 July 2022, all employees earning below $450 per month will be entitled to receive the superannuation guarantee from their employer, considering they meet the eligibility criteria.
So, all workers, regardless of how much they earn, will be entitled to receive superannuation payments from their employer.
Note: There are contribution age limits in place. Individuals under the age of 18 will need to work over 30 hours before they are eligible for superannuation payments (unless their workplace agreement indicates otherwise).
For more information click here.
Summary
Let’s recap
The super guarantee will increase from 10% to 10.5% on 1 July 2022.
STP Phase 2 has now been rolled out.
The concessional, non-concessional and maximum non-concessional super cap have been increased.
Super stapling is now in effect.
The work test for those aged 67-74 will be abolished on 1 July 2022.
The $450 monthly taxable income threshold will be removed on 1 July 2022.