On 24 January 2018 Treasury released details of a proposed ‘Superannuation Guarantee Integrity Package’ – including an exposure draft of the Treasury Laws Amendment (Taxation and Superannuation Guarantee Integrity Measures) Bill 2018 (available here).
The package includes some aspects that will be of interest to restructuring and turnaround professionals:
- The ATO will have power to issue a notice to an employer requiring payment of a superannuation guarantee charge amount within a nominated period not less than 21 days. Failure to pay within time would be a criminal offence of strict liability by the employer – but not the individual officeholders. Liquidators undertaking a review for possible unfair preferences will be very interested in identifying such notices: it would seem hard for the ATO to argue that receipt of funds after such a notice was issued was ‘in the ordinary course of business.’
- The ‘Single Touch Payroll Reporting’ system – which requires the real time reporting of withholding payments – will be extended. The regime currently applies to employers with more than 20 employees from 1 July 2018, but will apply to all employers from 1 July 2019. Insolvency appointees who continue the employment of staff will need to ensure that they also comply with these requirements.
- The ATO will have power to issue a Directors Penalty Notice in respect of SGC amounts at an earlier point in time than is currently the case. This will be achieved by amendments that will impose a theoretical obligation to cause a company to pay an SGC estimate before the company has an actual obligation to pay the estimate!
Responses to the consultation should be submitted by 16 February 2018.
Commentary on related reform, to address corporate misuse of the FEG scheme, is here.