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Implementing compulsory superannuation guarantee (SG) payments for the self-employed is an unnecessary step that would only increase red tape and complexity, according to the SMSF Association.
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SMSFA criticises compulsory SG for business owners
14 October 2016
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5 minute read
Speaking at the release of a joint research report by the SMSFA and Rice Warner, SMSFA chief executive Andrea Slattery said there has been an ongoing push to include the self-employed in the SG system.
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The research report, which Ms Slattery said studied the contribution patterns of 14,351 members, said indicates there is no need to include business owners in the SG system as they are already saving far more than they would be in an employment situation.
“Most of them are contractors, they have broken work patterns and a lot of them are women. So they need to be able to contribute when cash flows are working,” she said.
“This research confirms that they are actively involved in their own financial circumstances and they are actively saving already without compulsion. There’s actually no need to have compulsion because all you’re doing is overlaying the complexity on those times where they cannot contribute as much as they should.”
Ms Slattery said it is much better to have voluntary opportunities to contribute, which are achieving far more than intended, than to have compulsion, which will “create red tape and complexity”.
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