Superannuation guarantee (SG)
The compulsory super employers pay on top of wages.
The superannuation guarantee is the minimum super an employer must pay into your fund on top of your wages — 12% of ordinary earnings in Australia. It’s your money for retirement, held in a super fund. If you’re a sole trader you’re not obliged to pay yourself super, but you can, and it can be tax-effective.
The guarantee is paid on top of your wage, not out of it — a job advertised at $90,000 plus super means $90,000 in your pay and the guarantee on top. It counts towards your annual concessional contributions cap, so if you are also salary sacrificing, both together have to fit under the limit.
Worked example
On $90,000 of ordinary earnings the guarantee is 12%, so $10,800 goes into your fund for the year. Inside super it is taxed at 15% rather than your marginal rate, leaving $9,180 invested.
Common mistake
Reading “$90,000 including super” as the same offer as “$90,000 plus super”. In the first, the guarantee comes out of the figure and your actual wage is lower — worth clarifying before you accept, because the gap is thousands.
Grounded in ATO guidance. Figures last checked . General information, not tax advice.
Let Fin handle the jargon for you
Connect your bank and Fin sorts your income, expenses and GST automatically — so terms like this just become numbers that are already worked out. Free to start, no card needed.
Get 2Fin free →