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ISSUE 4
Contractor classification : Misclassifying a contractor as an employee, or vice versa, can result in incorrect superannuation contributions, leading to penalties and legal problems. Problems with payroll systems The challenges of superannuation compliance are heightened by the limitations of many payroll systems, particularly since most payroll teams rely heavily on payroll software. These systems often lag in updating for new regulations and struggle to integrate smoothly with superannuation funds, leading to delays or incorrect “High-profile cases, such as the recent issues in Australian universities, highlight the systemic risks and financial implications of non-compliance. ”
contributions—a problem that could worsen with Payday Super if software providers do not receive clear guidance and are not prepared. The lack of automation in some payroll systems also makes accurate management of superannuation contributions difficult. Automation is crucial for reducing errors and ensuring compliance, but many systems fall short. The value of superannuation guarantee rate can change often, requiring dynamic calculations to maintain compliance while ensuring accurate reporting of entitlements based on predefined rules. Moreover, the lack of guidance on Payday Super adds to the challenge for payroll specialists. Understanding what to do with payroll software when this change takes effect will likely be an ongoing and resource-intensive task for payroll teams, especially as they heavily rely on software providers to update their systems accordingly.
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