What are the new Ordinary Time Earnings (OTE) requirements for superannuation payments from July 1 2009? Find out what this means for your business.

The Australian Taxation Office (ATO) has clarified the definition of Ordinary Time Earnings (OTE) for Superannuation Guarantee Contribution (SGC) purposes.

Since 1 July 2008 employers have used OTE, not salary/wages, to calculate minimum superannuation contributions. The ATO have now issued a new ruling on the meaning of "ordinary time earnings" which affects payments made to employees from 1 July 2009.

This final ruling does include some new items in OTE such as Christmas bonuses and payments in lieu of notice. However the new ruling confirms, to the relief of employers, that overtime will not normally be included in ordinary time earnings. The ruling also notes that the Government still intends to clarify the superannuation guarantee status of certain kinds of leave payments, such as paid parental leave and jury duty payments.

For more information, please speak with us or refer to the ATO and Australian Taxation Office Superannuation Guarantee Ruling 2009/2.