Super to be paid on Paid Parental Leave
Good news has arrived for those planning a family in the next year or so. The government has decided to pay super guarantee equivalent payments on government-funded Paid Parental Leave (PPL). This will begin from 1st July 2025 i.e. for any babies born or adopted on or post this date. This measure is now law.
While Services Australia will continue to facilitate the PPL process, the ATO will be responsible for paying the super component (not employers). The ATO will pay the super in a lump sum at the start of the following financial year at the then super rate of 12% plus any interest owing. The first payments will be processed in July 2026.
This is a step forward in ensuring that those who choose to be stay-at-home parents are not disadvantaged in terms of future retirement savings. This is a good thing! A fairer system for all!
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