The Australian work landscape is changing. More than ever, workers are looking to leave behind the traditional nineto-five working day to take up task based work through platforms such as Airtasker, Freelancer and Uber.
While this emerging ‘gig economy’ can lead to increased autonomy, flexibility, and variety for workers, it also poses significant challenges — especially when it comes to super.
For most workers, employers must pay 9.5% of your salary into super. This applies to all full-time, part-time and casual workers. However, gig economy workers are generally self-employed freelancers or contractors, which means your employer has no obligation to pay you any super.
So, don’t leave yourself short. Here are 6 tips to keep your super growing in the gig economy.
1. Give your super fund your tax file number
You don’t have to give your super fund your tax file number, but if you don’t you may pay more tax on super contributions and your fund won’t be able to accept personal contributions. This can slow your super down.
2. Consolidate your super
If you have super funds from previous jobs, be sure to consolidate them into a single fund. This will save you paying multiple sets of fees and make keeping track of your super easier.
3. Make hay while the sun shines
By nature, the gig economy is irregular. It can pay to make extra contributions when the cash is flowing to keep your super growing and minimise the impact of any dry spells. Contributing as little as an extra ten dollars per week could add up to thousands in the long run.
4. Ask your spouse to kick in
If you earn less than $37,000 a year, your partner or spouse can help by kicking a little extra into your account. Apart from helping your super grow, it could also get them a tax offset of up to $540.
5. Get the government to kick in
If you earn less than $52,697 per year and make after-tax super contributions, the government will make a co-contribution into your account of up to $500 (the exact amount depends on how much you earn). The best part is you don’t have to do anything. If you’re eligible, the ATO will automatically make this payment when you lodge your tax return.
6. Watch out for “sham contracting”
Not all gigs are legit. Sham contracting is when an employer disguises an employment relationship as an independent contracting arrangement. This is usually done to avoid responsibility for employee entitlements — such as paying super. If you’re not sure if you are a contractor or an employee, contact the Fair Work Ombudsman on 131 394.