Say for an example someone has an income of $60k & gets their employer to salary sacrifice $20k of their wage into a SMSF, does that employer still pay 9% super contributions on that $20k, or they don't pay it because that amount is salary sacrificed?
Salary Sacrifice into SMSF
- Thread starter thesuperman
- Start date
Whatever amount you do salary sacrifice WILL NOT affect the employer's contributions to your super.
My understanding is the employer contribute 9% of your GROSS income to your super. Whatever extra contribution comes from your GROSS income, then your taxable income will be (GROSS minus whatever extra you sacrificed to super) in that financial year.
PS: talk to your accountant to ensure whatever you do it suit your taxation situation...
My understanding is the employer contribute 9% of your GROSS income to your super. Whatever extra contribution comes from your GROSS income, then your taxable income will be (GROSS minus whatever extra you sacrificed to super) in that financial year.
PS: talk to your accountant to ensure whatever you do it suit your taxation situation...
I believe that the employer would only be legally required to contribute on $40k in this example. However I haven't heard of an employer so tight that they wouldn't contribute based on $60k. Be careful that contributions do not exceed the concessional contribution cap.
Waiting for accounting nerds to deny or confirm. Anyway see your accountant and ask your employer how they treat SS.
correct, check with your employer to see if they reduce your SGC.
Always good to see a transaction history to ensure that your getting paid the right amount.
Have a read below.
http://www.ato.gov.au/businesses/PrintFriendly.aspx?ms=businesses&doc=/content/38336.htm <- have a look
Does salary sacrificing super affect your super guarantee payments?
If your employee is an eligible employee for super guarantee purposes, you are required to make super guarantee payments for them.
You must pay a minimum of 9% of each eligible employee's ordinary time earnings each quarter (up to the maximum contributions base for that quarter). Ordinary time earnings (OTE) is usually the amount your employee earns for their ordinary hours of work. It includes things like commissions, most bonuses, shift-loadings and allowances but doesn't include overtime payments.
Also Terry rightly pointed out do not go over your concessional contribution cap ( pretax).
Have a read below.
http://www.ato.gov.au/businesses/PrintFriendly.aspx?ms=businesses&doc=/content/38336.htm <- have a look
Does salary sacrificing super affect your super guarantee payments?
If your employee is an eligible employee for super guarantee purposes, you are required to make super guarantee payments for them.
You must pay a minimum of 9% of each eligible employee's ordinary time earnings each quarter (up to the maximum contributions base for that quarter). Ordinary time earnings (OTE) is usually the amount your employee earns for their ordinary hours of work. It includes things like commissions, most bonuses, shift-loadings and allowances but doesn't include overtime payments.
Also Terry rightly pointed out do not go over your concessional contribution cap ( pretax).
You will also need to ensure that your smsf is a complying fund as well.
Also consider whether it is tax effective for you to drop your salary into the lower tax brackets.
Also consider whether it is tax effective for you to drop your salary into the lower tax brackets.
