Content
- Superannuation Guarantee Reminders & Updates
- A win for those carrying student debt
- ATO Interest Charges Are No Longer Deductible – What Can You Do
- Trust Resolutions – Why Timing and Evidence Matter
- Non-compete clauses: the next stage
Superannuation Guarantee Reminders & Updates
On 1 July 2025 the superannuation guarantee rate increased to 12%, marking the final stage of previously legislated increases. Employers currently need to make superannuation guarantee (SG) contributions for their employees by 28 days after the end of each quarter (28 October, 28 January, 28 April and 28 July). There’s an extra day’s allowance when these dates fall on a public holiday.
To comply with these rules, the contribution must be in the employee’s superannuation fund on or before this date unless the employer is using the ATO Small Business Superannuation Clearing House (SBSCH).
Employers
To be eligible to claim a tax deduction on SG contributions, the quarterly amount must be in the employee’s super account on or before the above due dates. The only exception is where the employer is using the ATO SBSCH. In that case, a contribution is considered made provided it has been received by the SBSCH on or before the due date.
Employers using commercial clearing houses should be mindful of turnaround times. Some clearing houses may take up to 14 days to distribute employee contributions, so it’s recommended to allow sufficient time before deadlines. Missing deadlines—even by a day—triggers a superannuation guarantee charge (SGC) requirement, which results in loss of deduction and penalties.
The SGC requirements are outlined by the ATO here: The Super Guarantee Charge | Australian Taxation Office
Employers can make SG payments more frequently than quarterly. This may become essential if the proposed ‘payday’ superannuation reforms commence from 1 July 2026, requiring SG to be paid with each pay cycle. The SBSCH will close at that time, so employers should begin considering alternative arrangements. More information: Payday Superannuation | ATO
Employees
Employees should regularly check their super statements and reconcile employer contributions against payslips. Where contributions are missing or delayed, discuss this with your employer first. If unresolved, you can report unpaid super to the ATO: Report unpaid super contributions | ATO
A win for those carrying student debt
In support of young Australians and in response to rising cost-of-living pressures, the Australian Government has passed legislation to reduce student loan debt by 20% and change how repayments are determined.
20% reduction in student debt
The reduction will benefit more than 3 million Australians and remove over $16 billion in outstanding debt. The 20% reduction will automatically apply to anyone with eligible student loans such as HELP, VET Student Loans, or Apprenticeship Support Loans. The ATO will apply the reduction automatically—no action required.
The HELP debt estimator is a useful tool to get an idea of your reduction amount.
Changes to repayments
The repayment threshold for 2025–26 will increase from $56,156 to $67,000, meaning compulsory repayments will only be required on income above that threshold. Repayments continue via the tax system when lodging tax returns.
ATO Interest Charges Are No Longer Deductible – What Can You Do
Leaving debts outstanding with the ATO is now more expensive for many taxpayers. From 1 July 2025, general interest charge (GIC) and shortfall interest charge (SIC) are no longer tax-deductible—regardless of the income year the debt relates to.
Refinancing ATO debt
Businesses can refinance tax debts with a lender. Unlike GIC and SIC, interest on these loans may be deductible if the borrowing is connected to business activities. Before acting, ensure the interest qualifies for deduction.
Individuals
For individuals, deductibility depends on whether the debt arose from business activities. Sole traders can typically claim deductions; employees and investors generally cannot.
Companies, trusts, and partnerships
Companies and trusts follow the same logic: interest is deductible if the borrowing relates to income-producing activities. Partnerships are more complex—borrowings at the partnership level may qualify, but personal borrowings by partners usually do not.
Practical takeaway
With GIC and SIC no longer deductible, leaving ATO debts unpaid is now far costlier. Refinancing through an external lender might reduce your interest rate and potentially allow deductions—seek advice before acting.
Trust Resolutions – Why Timing and Evidence Matter
A recent decision of the Administrative Review Tribunal (Goldenville Family Trust v Commissioner of Taxation [2025]) highlights how critical documentation and timing are for trust resolutions. The case involved a family trust attempting to distribute income to a non-resident beneficiary. The ATO successfully argued the resolutions were invalid because there was no evidence they were made before year-end.
Timing of trust resolution decisions is critical
Trustees must decide income allocations by 30 June each year (or earlier if required by the trust deed). Formal paperwork can follow later, but it must reflect genuine decisions made before year-end.
If the ATO determines a decision was made after 30 June or documents were backdated, the resolution can be declared invalid—potentially triggering taxation at penalty rates.
Documenting decisions before year-end
Documentation shouldn’t be an afterthought. Produce contemporaneous evidence—such as meeting notes or time-stamped emails—to support when decisions were made. Proper documentation can mean the difference between a valid trust resolution and an expensive ATO dispute.
Non-compete clauses: the next stage
Back in March, the Government announced plans to ban non-compete clauses for low and middle-income employees and review their use for higher-income workers, with reforms to take effect from 2027.
Treasury has issued a consultation paper seeking feedback on key implementation details, including how the ban will work, whether additional reforms are needed for post-employment restraints, and whether to clarify rules on concurrent employment for part-time or casual workers.
The Government has no intention of changing how restraint of trade applies to business sales or confidentiality clauses. However, if these reforms are implemented, employers will need to review existing agreements and update them accordingly. We’ll keep you informed as more details emerge.
