Superannuation changes effective 1st July 2022

Annual Superannuation Guarantee (SG) rate increase

On 1 July 2022, the super guarantee (SG) rate will increase from 10% to 10.5% and is scheduled to progressively increase to 12% by July 2025, as follows:

Tax period/Financial year

Minimum SG % rate

1 July 2022 – 30 June 2023

             10.5

1 July 2023 – 30 June 2024

             11.0

1 July 2024 – 30 June 2025

             11.5

1 July 2025 – 30 June 2026 and onwards

             12.0

  • The SG rate you’re required to apply depends on when the employee is paid as opposed to when the income is earned;

  • This means the increased SG rate will need to be applied to any pay runs with a date paid on or after 1 July, even if some or all of the relevant pay period is before 1 July.

Removal of the $450 superannuation eligibility threshold when determining who is eligible for super

On 11 May 2021, as part of the 2021–22 federal Budget, the Australian Government announced it will remove the $450 per month threshold to expand coverage of super guarantee to eligible employees regardless of their monthly pay.

The change is now law by the Treasury Laws Amendment (Enhancing Superannuation Outcomes For Australians and Helping Australian Businesses Invest) Act 2021External Link with royal assent on 22 February 2022.

From 1 July 2022, employers will be required to make super guarantee contributions to their eligible employee’s super fund regardless of how much the employee is paid.  Employees must still satisfy all other super guarantee eligibility requirements.

For employees under 18 years of age, superannuation entitlement is limited to only those weeks in which they work 30 or more hours.

  • Employers will need to check that their payroll and accounting systems superannuation settings have been updated for wages paid on after 1 July 2022, to ensure they correctly calculate their employee’s super guarantee entitlement.