Ordinary time earnings – annual leave loading

The ATO has taken the view that annual leave loading will be ordinary time earnings (OTE) unless it is referable to a lost opportunity to work overtime. Put simply, annual leave loading is not automatically exempt from superannuation anymore and all employers need to show the reason as to why annual leave loading is being paid. We encourage employers to check their relevant awards/agreements for future payments because some payments may be exempt eg: if an employee is being paid annual leave loading to compensate for the fact that they would normally get paid overtime in a working week. For more information visit : 

https://www.ato.gov.au/Business/Super-for-employers/In-detail/Ordinary-time-earnings/Ordinary-time-earnings---annual-leave-loading/

 

 

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