Paying super on expanded government paid parental leave
The Treasurer has announced that the Federal
Government will pay superannuation on paid parental
leave from 1 July 2025. The intention is that the
superannuation will be administered by the ATO,
meaning that employers will not have to process these
payments on the government’s behalf . Further details
of this measure, including cost, will be released in the
Federal Budget due to be handed down in May 2024.
The Treasurer has said that this reform builds on the
government’s work to “modernise” paid parental leave
and expand the payment to cover a full six months by
2026. The expansion to Australia’s Paid Parental
Leave Scheme will give families an additional six
weeks of paid parental leave in total: an extra two
weeks of leave (for 22 weeks total) from 1 July 2024,
increasing to 24 weeks from July 2025 and 26 weeks
from July 2026.
Employers will continue to be involved in the
administration of payments if an employee elects to
take eight or more weeks of their entitlement
consecutively. For any shorter periods, Services
Australia will pay the individual directly.
Important: Clients should not act solely on the basis of the material contained here. Items herein are general comments only and do not constitute or convey advice per se. Also, changes in legislation may occur quickly. We, therefore, recommend that our formal advice be sought before acting in any of the areas.
