Client Login

Superannuation Guarantee opt-out | what does this mean for individuals?

Treasury Laws Amendment (2018 Superannuation Measures No. 1) Bill 2019 was passed by the Senate on Thursday 19 September.


From 1 January 2020, eligible individuals with multiple employers can apply to opt-out of receiving super guarantee (SG) from one or more of their employers. The measure has been introduced to help certain individuals avoid unintentionally exceeding their concessional contributions cap ($25,000 for the 2019/2020 year).


To be eligible to opt-out of superannuation guarantee from one or more employers you must:

  • Have more than one employer, and
  • Expect your employer’s mandated concessional superannuation contributions to exceed your concessional contributions cap for a financial year.

If you meet the basic eligibility conditions above, you will need to apply for a superannuation guarantee (SG) employer shortfall exemption certificate. The certificate releases one or more of your employers from their SG obligations for up to four quarters in one financial year. You’ll still need to receive SG contributions from at least one of your employers for each of those quarters. Note the certificate only applies for up to four quarters, so you essentially need to reapply for an exemption certificate every year.

How the new measure operates

The opt-out only applies to employees with multiple employers, because the existing law does not create this same problem for those with only one employer due to the operation of the maximum contribution base. The maximum contribution base enables employers to only make SG contributions up to a certain earnings level, which does not result in exceeding the concessional cap. However, where an individual has multiple employers, even if they rely on the maximum contribution base for each employer, they may still exceed their concessional contributions cap.

The exemption certificate means the employer will not be liable for the super guarantee charge (SGC) if they don’t make SG contributions on your behalf for the quarters covered by the certificate.

However, it is important to talk to your employer before applying as they can choose to disregard an exemption certificate and continue to make SG contributions. The idea of the certificate is to give employers protection from breaching the SG rules should they rely on this opt out mechanism.  It is not designed to prevent them from making contributions should they choose to do so.

Other considerations

This measure may not benefit everyone who’s eligible. As with any negotiations around salary and superannuation, both the individual and the employer would need to carefully consider the impact of any arrangement. Consider your employment arrangements carefully, such as how your pay and other entitlements may change and the effect of any relevant award or workplace agreement applicable to you.

Apiary Financial can help

We can help you understand the SG opt-out and whether this is appropriate for your circumstances.

If you would like more information about the SG Opt-out or assistance with the exemption certificate application, please contact our team on 07 3217 2477.