ATO retrieves $8 million in unpaid super

20 January 2015

The Australian Taxation Office (ATO) is cracking down on companies that are failing to pay their workers their superannuation entitlements, after it was given new powers to kerb "phoenix behaviour".

The ATO has recovered $8 million in worker's super entitlements from labour-hire company operators in South Australia and Victoria.

It found these companies, which ran services such as meat packing and seasonal fruit picking had not paid their workers their entitlements.

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The ATO was recently given new powers known as superannuation guarantee estimates, where they can intervene if they see phoenix activity and hold companies liable if they do not pay entitlements before they try to liquidate to escape responsibility.

"The ATO can also issue director penalty notices, which make directors personally liable for the company's unpaid superannuation obligations," deputy commissioner Michael Cranston said.

Phoenix behaviour is where companies purposefully trying to liquidate to avoid paying super obligations and other tax liabilities, and to avoid paying creditors and suppliers.

The ATO can deal with this problem in real-time by estimating the company's super obligations and raising a debt on the company or its directors before the company goes into liquidation.

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