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PB
27-05-2009, 08:42 AM
Not sure how many Greenkeepers or Clubs keep up to date with the Superannuation laws but this would most likely effect a large percentage of clubs and contractors out there.

Clubs need to also note that regardless of what their contracts might say they are still liable. RU discovered this when shortly after our recent appointment I had a discussion with our auditor and had my suspicions confirmed. So working on the basis that if we got it wrong no doubt some other clubs have got it wrong too.

Taken from ATO website http://www.ato.gov.au/businesses/content.asp?doc=/content/19159.htm&pc=001/003/090/001/003&mnu=&mfp=&st=&cy=1
If you pay your contractors under a contract that is wholly or principally for labour, you have to pay super contributions for them. This is even if the contractor quotes an Australian business number (ABN). These contractors are considered your employees for Superannuation guarantee purposes.

Generally, a contract is principally for labour if more than half of the value of the contract is for the person’s labour, which may include:

physical labour
mental effort, or
artistic effort.

Fatty
27-05-2009, 02:59 PM
I guess a contract with a singular person does not mean he is necessarily a contractor. But if you engage a contractor who has several employees then I would ask "do we have to pay the superannuation guarantee." Probably not because you are employing a company that has employees and not a sole owner/operator on a dfull time basis.

from the ATO more specific.

Superannuation Guarantee contributions

Even if the worker is a contractor, legislation may require that the principal make Superannuation Guarantee contributions on behalf of the worker. Again, if another entity is invoicing the principal for the worker’s services then Superannuation Guarantee obligations are unlikely to arise. The issue will generally arise only where the worker is a sole trader supplying the principal with tax invoices bearing an ABN for his or her services.

If the contract between the principal and the worker is wholly or principally for his or her labour then Superannuation Guarantee obligations will arise. A contract is wholly or principally for labour if the value of the labour component of the contract is more than 50% of the value of the whole of the contract. Labour includes mental and artistic effort.

Superannuation Guarantee obligations may arise for the following workers depending on their relationship with the person to whom they provide their services:
• people who receive payment for performing, presenting, participating or providing services in connection with any music, play, dance, entertainment, sport, display or promotional activity, or any similar activity involving the exercise of intellectual, artistic, musical or other creative talents;
• people who receive payment to perform or provide services in connection with the making of any film, tape or disk or of any television or radio broadcast.

Glory glory
27-05-2009, 03:20 PM
cheers i'll be lookin into this

i sort of half thought this yaknow

PB
27-05-2009, 03:31 PM
Thanks for the expansion fatty

moosc
27-05-2009, 03:42 PM
I was of the opinion that that only applied if a contractor worked more than 80% of his salary for the one customer. If he did then he was considerred an employee of that customer for tax purposes, otherwise he did not. In which case you may well be correct.

Even if a contractor works for more than 80% of any one customers work he can avoid being considerred an employee if he is actively seeking work(advertising, tendering etc) from any other parties.

My understanding was that as a sole trader it was not mandatary for me to pay any compulsory superanuation to myself.

My experience is that I have operated as a sole trader since 1999.

Still I'd be getting advice.

Neil W

Glory glory
27-05-2009, 03:55 PM
moosc ya lost me

hey fatty could ya please put that in simpelton words for me cheers

Fatty
27-05-2009, 03:59 PM
Don't fret Moosc

There is a whole section just for you but if in doubt seek professional advice

Your superannuation obligations


This information forms part of the publication Tax basics for small business (NAT 1908). It is also available in PDF (554KB) and paper formats.

As an employer, you must pay super for your eligible employees and certain contractors. This is called the superannuation guarantee. Your employees may also be eligible to choose the super fund you pay their super into.

The following table summarises the super obligations you have to yourself, employees and contractors, depending on your business structure.

Yourself


Sole trader or partnership

If you operate your business as a sole trader or partnership, you are not an employee and the superannuation guarantee rules don’t apply to you.

Instead, like any self-employed person, you can claim a deduction for personal contributions you make to a superannuation fund. You may also be eligible for a super co-contribution if you make personal super contributions.

You should seek professional advice when considering your own superannuation

Company or trust

If your business operates as a company or a trust, you are likely to be a director or an employee. In this case, the superannuation guarantee minimum rules apply to you in the same way as they apply to other employees.

Employees


Sole trader, partnership, company or trust

Regardless of your business structure, you’re required to contribute 9% of an eligible employee’s earnings base to a complying superannuation fund or retirement savings account at least every quarter. You may have to allow your eligible employees to choose which superannuation fund they want to use. You must also pass on your employee’s tax file number (provided in their Tax file number declaration form) to their superannuation fund.

Contractors


Sole trader, partnership, company or trust

You must make superannuation contributions for a contractor if their contract is wholly or principally for labour (more than 50% of the value of their contract is for labour).

Fatty
27-05-2009, 04:08 PM
Glory Glory

I would love to put it in simplier words but that would be against the law.

Advice and interpratations on financial and tax matters can only be given by people with the right qualifications. I don't have any in that area.

You can always call the ATO helpline, no names need to be given, just general advice will be given.

Cheers
Fatty

David South
27-05-2009, 04:25 PM
I looked into this some years ago at St Kilda. It isn't simple at all.

To look at some extremes - if the greenkeeper works hours as specified by the Club, is directed in how he does his job by the Club, and the Club is supplying all the machinery and equipment, and all the fertilizer, chemicals etc, he is an employee - whether he has a contract or not.

On the other hand, a greenkeeper whose contract simply says he is to manage the greens, in whatever way he sees fit, and who owns the machinery (presumably transporting it from one club to another if he has contracts with more than one club) and provides the fertiliser and chemicals is a contractor.

Most situations are somewhere in between. Has anyone actually been caught out on it yet?

Glory glory
27-05-2009, 04:32 PM
i'd be tippin that every second greenkeeper in melbourne is now looking into it

but it could take awhile. i've now been on hold for over 1/2 hour with the ato supper bit. ready to hang up

dunny
27-05-2009, 04:45 PM
i'd be tippin that every second greenkeeper in melbourne is now looking into it

but it could take awhile. i've now been on hold for over 1/2 hour with the ato supper bit. ready to hang upimagine all the ramifications of this including compensation for past years. could be huge

Fatty
27-05-2009, 04:59 PM
Dunny

This is true......this is why I love the phrase:-

"We're only a bowling club not a business, doesn't need to be run like a business"...I am sure you have all heard it said.

Unfortuantely bowling clubs need to be run like businesses because of these sort of issues.

You don't get out of fines because you say ".....but we are only a bowling club"

As David pointed out one extreme to another. Somewhere in between well I don't think the tax dept would like the in between, my opinion is unless the club engaged the services of a contractor.....all the in betweens would be classified as "people employed by the club on a contract" which means they are treated like employees for the superannuation guarantee.

This is only my opinion, which doesn't count for a lot, a lot of the time :smile:

Fatty

BIG BAWLS
27-05-2009, 06:05 PM
Who has got the ATO number time to add a little medicine back to some of the clubs that just think we will go through the tender process and get rid of him that way with no rammifcations


wouldnt also be whats written in the contract most state that contractor must look after own super ???? but then again if thats the law ????? can they pass it over to the greenkeeper for him to pay his own if both parties have signed on it ???? If it was law and they havnt ?. what then

Me thinks very grey area !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Fatty
27-05-2009, 06:40 PM
Superannuation Guarantee-9% to be paid by the employer this is law. As for being a contractor or an individual that is contracted. An individual that is contracted to the club for a period of time is probably not a contractor in the eyes of the ATO, he would be classified as an employee. refer above posts


ATO has all information regarding this matter available online. Here is one source:-

http://www.education.vic.gov.au/hrweb/e ... superg.htm (http://www.education.vic.gov.au/hrweb/employcond/salary/superg.htm)

There are big penalties for any employer breaking these rule.

Superannuation Guarantee Charge

Where an employer does not provide the minimum level of superannuation support in accordance with the Superannuation Guarantee (Administration) Act 1992, then the Superannuation Guarantee charge will be payable to the Australian Taxation Office.

The Superannuation Guarantee charge consists of three components:

* the total of all employees' individual superannuation shortfalls;
* an interest component (currently 10 per cent);
* an administration fee of $20 for each employee for whom there is a shortfall.

Back to Top
Quarterly Superannuation Guarantee Requirements

From 1 July 2003 employers must pay Superannuation Guarantee contributions on behalf of employees at least every quarter.

The payment due dates are as follows:

* For the period: 1 July - 30 September, payment is due by: 28 October
* For the period: 1 October - 31 December, payment is due by: 28 January
* For the period: 1 January - 31 March, payment is due by: 28 April
* For the period: 1 April - 30 June, payment is due by: 28 July

The quarterly Superannuation Guarantee legislation imposes a requirement on employers to report Superannuation Guarantee payments to their employees.

Fatty
27-05-2009, 06:51 PM
There are a lot of greenkeeprs reading this post.

So I think if I was a greenkeeper I would be going and asking a professional or calling the tax office and getting specific advice for my situation.

First thing a greenkeeper should ask the tax office...

"Am I classified as a contractor or an employee"....If you have a contract that doesn't make you a contractor, so read you specific contract out and get a proper answer.

I guess unions would have people that would be able to answer these questions.

Remember nothing said on this topic by anyone here can be taken for "Gospel" so seek the proper and legal answer.

Maybe you are missing out on some compulsory entitlements. Check it out!!!!
This law has been out for a long time now...I think it started at 5%.

Fatty

Perko
27-05-2009, 07:06 PM
My understanding is that a contractor adds his/hers super into the tendering price.
Most tendering documents state this anyway.
PB you certainly have opened a can of worms here :smile:

Glory glory
27-05-2009, 07:56 PM
My understanding is that a contractor adds his/hers super into the tendering price.
Most tendering documents state this anyway.
PB you certainly have opened a can of worms here :smile:

but if its law perko then the clubs are answerable, doesn't matter wats been signed. plus back pay and loss of profits on ya $$$$$

i'm certainly going to look into it

Perko
27-05-2009, 08:05 PM
Certainly worth looking into for sure.
Some clubs might have to sell a rink or 2 :smile: even a green

Glory glory
27-05-2009, 08:11 PM
Certainly worth looking into for sure.
Some clubs might have to sell a rink or 2 :smile: even a green

thats there problem. if i'm intitled to my money then i want it and if they have to take out a loan well serves um right for gettin it wrong

if i'm not entitled to it so be it

BIG BAWLS
27-05-2009, 10:04 PM
Certainly worth looking into for sure.
Some clubs might have to sell a rink or 2 :smile: even a green

thats there problem. if i'm intitled to my money then i want it and if they have to take out a loan well serves um right for gettin it wrong

if i'm not entitled to it so be it



sounds like the conversation we had tonight on the phone before ya bird ,swine ,mad cow flu kicked in !!!!!!!!!!!!!

PB
28-05-2009, 08:45 AM
My understanding is that a contractor adds his/hers super into the tendering price.
Most tendering documents state this anyway.
PB you certainly have opened a can of worms here :smile:

but if its law perko then the clubs are answerable, doesn't matter wats been signed. plus back pay and loss of profits on ya $$$$$

i'm certainly going to look into it
I might of opened a can of worms, but I'd rather open it in a way that lets Clubs and greenkeepers work through it together now than a few years down the track.

On further investigation the law changed in 2008. The reason behind the change was to protect many subcontractor in the building industry and those working as drivers from being ripped of by an unscrupulous boss

Glory glory
28-05-2009, 09:16 AM
My understanding is that a contractor adds his/hers super into the tendering price.
Most tendering documents state this anyway.
PB you certainly have opened a can of worms here :smile:

but if its law perko then the clubs are answerable, doesn't matter wats been signed. plus back pay and loss of profits on ya $$$$$

i'm certainly going to look into it
I might of opened a can of worms, but I'd rather open it in a way that lets Clubs and greenkeepers work through it together now than a few years down the track.

On further investigation the law changed in 2008. The reason behind the change was to protect many subcontractor in the building industry and those working as drivers from being ripped of by an unscrupulous boss

potentually a can of worms that will benifit those getting ripped off.

i personnally would like to say thank you

Glory glory
31-05-2009, 01:54 PM
what i've found out so far on the superanuation

if a contractors main earning (80%) are from the one club. then that club is liable to pay his super. yet if its written into the contract that the contractor is to pay is own super (so hes added that price into his quote), they are not liable to pay.

bummer for me i got all excited

Fatty
31-05-2009, 02:46 PM
Glory Glory

Make sure your next contract negotiations you really work out what you are really worth.,

Did you get this info from tax office?...I hope so.

Fatty

Glory glory
31-05-2009, 07:34 PM
Glory Glory

Make sure your next contract negotiations you really work out what you are really worth.,

Did you get this info from tax office?...I hope so.

Fatty

will still look a little future. got info from an accountant

Fatty
31-05-2009, 07:53 PM
Glory Glory..

I am sure the accountant would be up with the rules if he is tax accountant.

Well bad luck but at least we were thinking of you. Kerp looking into it, you never know.
Best wishes to you and good luck with your greens this summer. No idea what club you green keep for but my best wishes are honorable.

Cheers
Fatty