New superannuation opt-out for high income earners

In brief 1 min read

From 1 January 2020, individuals who have more than one job may be able to opt out of receiving super contributions from all of their employers.

Key takeaways

• Employers won't need to make super contributions on behalf of employees who have successfully opted out, and won't be liable for the superannuation guarantee charge.
• Employers and high income employees will be able to explore other remuneration structures.

The changes

Employees are eligible to opt out for a financial year if they have more than one employer and expect their total concessional super contributions from their employers to exceed the concessional contributions cap.

Provided the employee receives super guarantee contributions from at least one employer in each quarter of the financial year, other employers will be released from their contribution obligations. An employer can continue to make contributions for the relevant quarters, but it won't be liable for the superannuation guarantee charge if it doesn’t.

Importantly, only the employee can apply to opt out and the ATO will decide whether it is appropriate in the circumstances.