You could take home less pay from July 1: Here’s why
The superannuation guarantee is increasing on July 1 from 10 per cent to 10.5 per cent, meaning some Aussie workers will take home less pay.
If your superannuation contributions are part of your whole salary package your employer could choose to reduce your take home pay to cover the increased super contributions.
But, if you are paid a certain amount plus super, your take home pay will likely remain the same.
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According to 2021 Mercer analysis, 48 per cent of employers paid super on top of the base salary, while 52 per cent included it in the total salary package.
The same analysis found 21 per cent of employers were planning to have their employees bear all or some of the cost of the increase.
“Asking employees to absorb or split the additional superannuation guarantee, or even subsume the increase in existing above-minimum employer contribution all might be perceived as putting economics before empathy,” Mercer said.
“Moreover, reducing the real or perceived employee benefit is likely to put pressure on employee engagement and retention.”
All the superannuation changes coming July 1
The Superannuation Guarantee (SG) rate will increase from 10 per cent to 10.5 per cent
The current $450-per-month earnings threshold for the SG will be removed, meaning that the SG will have to be paid for nearly all employees
The work test will be repealed for those aged 67-74 in respect of funds accepting voluntary employer, non-concessional and salary-sacrifice contributions (the work test will still apply at these ages to claim a personal contribution tax deduction)
The minimum age for making Downsizer contributions will reduce from 65 to 60
The potential to take home less pay comes as Aussies are struggling with the increased cost of living.
The CPI rose 2.1 per cent in the March 2022 quarter and 5.1 per cent annually, according to the latest ABS data.
The most significant contributors to the rise in the March-quarter CPI were new property prices (+5.7 per cent), fuel (+11 per cent) and tertiary education (+6.3 per cent).
"Continued shortages of building supplies and labour, heightened freight costs and ongoing strong demand contributed to price rises for newly built dwellings,” ABS head of prices statistics Michelle Marquardt said when the data was released.
"The CPI's automotive fuel series reached a record level for the third consecutive quarter, with fuel price rises seen across all three months of the March quarter."
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