Does annual leave loading accrue long service leave and incur Super guarantee?

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Ben_S
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Does annual leave loading accrue long service leave and incur Super guarantee?

Does annual leave loading accrue long service leave and incur Super guarantee on a leave loading payout at EOFY or any other time?

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AliK607
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Re: Does annual leave loading accrue long service leave and incur Super guarantee?

Hello @Ben_S ,

 

This might be of help to you:
https://community.ato.gov.au/t5/General-super-questions/Is-leave-loading-payment-superable/td-p/840

As leave loading is not Ordinary time earnings (OTE), accordingly to the article it would not qualify for super and hence also would not qualify for long service leave (as long service leave accrues on OTE)


For more information on the setup of leave loading, please visit the article below:
http://help.myob.com/wiki/x/1QJNAQ


Regards
Ali
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NikkiParsons
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Re: Does annual leave loading accrue long service leave and incur Super guarantee?

Hi @AliK607 and @Ben_S 

 

I'd check this out and make sure as leave loading can be OTE https://www.ato.gov.au/Business/Super-for-employers/How-much-to-pay/Checklist--salary-or-wages-and-o....

 

Ben I'd also ensure you're following the leave payout legislation as if you're paying out leave just because it's the EOFY I'd make sure you've met the conditions to be able to do so.

DuncanS
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Re: Does annual leave loading accrue long service leave and incur Super guarantee?

@Ben_S @NikkiParsons 

 

Ben,

 

Nikki gave you a good reference from the ATO.

Annual Leave Loading was not OTE for many years.

The ATO changed their view around 2018.

 

I recall from memory that Annual Leave paid out during employment was not OTE.

The ATO reference does not distinguish Annual Leave paid out during employment.

 

Please check with the ATO and confirm with your Tax Accountant.

 

Duncan

Duncan Smith
Business Advice + Tax
Helping business owners build a better business since 1998
E duncan@businessadvicetax.com.au T 02 9904 3672 7 days

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