Compulsory super and the superannuation guarantee
Super is compulsory for most employed Australians. It’s a universal scheme designed to help you build up and save for retirement. The Australian superannuation system requires your employer to make regular contributions into your super account. This is the ‘Superannuation Guarantee’, and it is equivalent to 9.5% of your wage. Ideally, it’s transferred to your chosen super fund at the same time you receive your pay.
Generally, you’re entitled to super guarantee contributions from an employer if you are:
- 18 years old or over and
- paid $450 or more (before tax) in a month
It doesn’t matter if you’re full time, part time or casual, or if you’re a temporary resident of Australia – you’re still covered by superannuation entitlements.
It’s important to remember that the compulsory superannuation contribution does not come out of your pay – it’s an extra payment made by your employer on your behalf.
Under 18 years of age?
To be entitled to compulsory super contributions if you’re under 18 years of age, you must:
- earn at least $450 before tax each month and
- work more than 30 hours in a week
What about contractors?
Under superannuation law, if you’re a contractor who is paid wholly or mostly for your labour, you’re considered to be an employee and therefore entitled to super guarantee contributions just like any other employee.