You now could go to jail if you do not pay your employees superannuation obligations.

If you have cash flow issues, never not pay your employee’s superannuation, it must be one of the first expenses you pay. With software systems such as Xero, it is very easy to pay your superannuation at the same time you pay your employees.

Why must you always pay your employees super by the due date? You lose the super contribution as a tax deduction and required to complete superannuation guarantee statements, but also the ATO has increased power to not only issue director’s penalty notices but to issue a direction to pay.

If the director is issued a direction and does not pay the liability within the period specified in the direction the penalty is up to 50 penalty units ($10,500) or imprisonment for 12 months or both.

If you are an employee, always check your fund to make sure your contributions are going in at a minimum each quarter. For employers, please make sure you pay the superannuation by the due date and in line with super stream requirements. If your employee has not provided their super details to you and you need to make payment, then I would recommend you paying it to a default fund to avoid the above consequences.