The government and tax office have estimated as many as 7,000 businesses will come forward once the amnesty is passed. Australian Small Business and Family Enterprise Ombudsman Kate Carnell said recognition of the amnesty would be a win for smaller employers, but it would also up the ante on future compliance.
“It’s an opportunity to catch up without penalties, but the penalties that will exist after the [amnesty] has passed are quite significant,” Ms Carnell said.
The government’s new suite of penalties for unpaid super after the amnesty period includes jail terms for employers who deliberately avoid complying with the superannuation guarantee.
Ms Carnell said while it wasn’t correct behaviour, many smaller employers had paid super late in the past after being caught out by business disruptions like natural disasters which had thrown out their quarterly cashflows.
“There is no doubts that floods and drought and bushfires, all sorts of things get in the way of cashflow. It [late payment] shouldn’t happen, but it has, and it’s a planning issue.”
Once the amnesty period concludes there will be no excuses and businesses will not be able to stay in the mindset of delaying superannuation payments, Ms Carnell said.
Tax and Super Australia senior tax counsel John Jeffreys said he expected a rush of businesses to put their hands up should the amnesty become law.
“This is going to be the last chance: they [employers] are probably never going to see something like this again,” Mr Jeffreys said.
A combination of increased ATO oversight and public awareness about unpaid super means that regardless of the amnesty, employers will no longer be able to plead ignorance as an excuse for non-payment, he said.
“That whole heightened awareness is really going to drive this issue along,” he said.
The ATO are seeing in real time this tremendous amount of information.
Accounting experts have previously warned the super amnesty would not provide coverage to all non-payment issues and said the introduction of single-touch payroll was more of a concern for smaller operators.
Mr Jeffreys said the introduction of digital systems was leaving businesses exposed to penalties for underpayments, regardless of the superannuation amnesty.
“The ATO are seeing in real time this tremendous amount of information,” he said.
The ATO said should the law pass, it would apply to non-payments prior to May 2018.
“Until the proposed amnesty law is enacted by parliament, we will continue to apply the existing law to the Superannuation Guarantee Charge statements you lodge with us,” a tax office spokesperson said.
Follow MySmallBusiness on Twitter, Facebook and LinkedIn.
Emma is the small business reporter for The Age and Sydney Morning Herald based in Melbourne.