Forum Discussion

Contributing Cover User

6 years ago

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
6 years ago
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

AliK607

MYOB Staff

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

NikkiParsons

Valued Cover User

6 years ago

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-ordinary-time-earnings/.

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
Ultimate Partner
6 years ago
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

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

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