Superannuation for Filmmakers

This blog post was last updated on the 8th June 2018.

Disclaimer

Ok – lets start with a massive disclaimer to get the ball rolling…

I’m not a lawyer, I’m not an accountant, I don’t work for the ATO, and I have no formal business training – I’m just a filmmaker, so beware!

(Side note, if you ARE an accountant, work for the ATO, or have formal business training, and something I’ve written below is incorrect or misleading, please let me know!)

The information contained on this blog is for general guidance on matters of interest only. The application and impact of laws can vary widely based on the specific facts involved. Given the changing nature of laws, rules and regulations, and the inherent hazards of electronic communication, there may be delays, omissions or inaccuracies in information contained in this blog entry.

Accordingly, the information on this blog is provided with the understanding that the author, and the company he works for, is not herein engaged in rendering legal, accounting, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with professional accounting, tax, legal or other competent advisers. Before making any decision or taking any action, you should consult a professional.

While we have made every attempt to ensure that the information contained in this blog has been obtained from reliable sources, LateNite Films is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information in this blog is provided “as is”, with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose.

In no event will LateNite Films or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this blog entry or for any consequential, special or similar damages, even if advised of the possibility of such damages.

Certain links on this blog connect to other web sites maintained by third parties over whom LateNite Films has absolutely no control. LateNite Films makes no representations as to the accuracy or any other aspect of information contained in other web sites.

And with that out of the way, let’s begin…

What is Superannuation?

Superannuation – more commonly known as just “super” – is essentially money that’s put aside and saved whilst you’re working, so that you can have a regular income when you retire.

It’s similar to a managed fund where your money is pooled with other members’ money and invested on your behalf by professional investment managers – so that your little nest egg can grow bigger more quickly than if you just kept your money in a normal bank account gaining interest.

Most super funds offer a variety of different investment options. These usually include pre-mixed options that will contain a mix of different asset classes, and single sector options such as cash, property and shares.

Most super funds also offer life insurance for their members.

To complicate things slightly, if you want even more control over your superannuation, you can setup a self-managed super fund (SMSF).

There’s no fixed retirement age in Australia – but many people choose to retire when they become eligible for the Age Pension. As of June 2018, the current Age Pension age is 65 and this will rise in stages to 67 in July 2023. If current Government proposals are accepted, the Age Pension age will be 70 by 2035. However, as of today, you can access your super when you turn 65 (even if you haven’t retired). On average, most Australian’s can expect around 20ish years of retirement – so by investing money in your superannuation fund, you’re basically (hopefully) putting a whole bunch of money aside, so that when you’re no longer working, you still have money coming in to do fun stuff. The more money you put away when you’re working, the more you’ll be able to spend in your retirement!

It’s your money, so once you’ve turned 65, you can choose to have a regular super income stream (basically, you just keep getting paid a wage, just like when you were working a normal job), you can combine your regular income stream with the Government Pension, or you can take out a lump sum if you’re really game (and make that feature film you always wanted to do as a youngster)!

There are also some very limited circumstances when you can access your super early – mainly related to specific medical conditions or severe financial hardship.

HOW DO YOU GET PAID SUPER?

For most people, super begins when you start work and your employer starts paying super for you.

To quote the ATO:

You pay super no matter whether the employee:

  • is full-time, part-time or casual
  • receives a super pension or annuity while still working - including those who qualify for the transition-to-retirement measure
  • is a temporary resident - when they leave Australia, they can claim the payments you made through a ‘departing Australia superannuation payment’
  • is a company director
  • is a family member working in your business - provided they are eligible for SG.

At a very basic and fundamental level, if you work for a company or organisation (regardless of whether you’re part time, casual or even a contractor in some cases), are over the age of 18 and earning more than $450 gross a month, then your employer must pay money into a super account in your name, which is then managed by a super fund of your choice (with some exceptions as some industrial awards specify a fund or a choice of a few funds that super must be paid into).

Superannuation should never be transferred from one back account to another – it needs to be processing through the proper superannuation channels (normally a clearing house). You need to pay and report super electronically to ensure it meets SuperStream requirements. Super guarantee payments must be made to complying funds or retirement savings accounts by the quarterly due dates, which are 28 days after the end of each quarter. Some super funds require employers to make contributions monthly, and when you register with a fund with this requirement, you are agreeing to make monthly contributions to that fund.

Employees shouldn’t have to really think about the mechanics of how they get paid super – employers should just pay it, after receiving all the correct paperwork. However, employees should have a good understanding of how superannuation works, because it’s their life savings on the line!

The formula used is currently 9.5% of your income, including bonuses, commissions and loadings. This is called the Super Guarantee and it’s the law.

To quote Arts Law:

Under the SGC salary or wages have their ordinary meanings, and include payment to a person for work or services by the day, week or month; allowances (but excluding expense reimbursements and allowances and other payments which are fringe benefits); bonuses, commissions and ex gratia payments; overtime and penalty rates; annual leave, long service leave, sick leave and leave loading. Ordinary time earnings means earnings for ordinary hours of work and could include overtime, shift loading or commission.

The ATO has a checklist to help you identify what payments are considered salary or wages and whether they are considered part of ordinary time earnings (OTE) for super guarantee purposes.

It’s slightly confusing, but when talking about casual workers – the Super guarantee is currently calculated at 9.5% of a casual employee’s ordinary time earnings. This includes their wage plus any casual or shift loadings for ordinary hours of work. It also includes commissions and some allowances, but it doesn’t include overtime payments.

You can also add extra money to your super account, so that your future self has a better retirement. On that note, to quote the ATO:

If you’re a low or middle-income earner and make personal (after-tax) contributions to your super fund, the government also makes a contribution (called a co-contribution) up to a maximum amount of $500.

Your super is your savings for retirement. It is important to be aware of what super accounts you have, how much is being contributed, and what insurance they provide. You can use the myGov service to consolidate superannuation funds – as ideally you only want a single super fund, to keep fees to a minimum.

THE SUPER DILEMA

In theory – superannuation should be really simple, but there’s still a lot of confusion surrounding it – especially in the Film & Television world (although it also happens in hospitality & construction too!), where a lot of people in the industry are freelancers and contractors. It’s also slightly more complicated than you might initially think as there’s some additional rules and clauses you need to take into consideration when using standard SPA/MEAA agreements for both cast and crew (explained below).

The Tax Office estimated that in 2014-15 there was a $2.85 billion-a-year shortfall, or a 5.2 per cent gap, in what employers should be paying their employees in super and what was paid.

To quote an SBS article:

Federal Financial Services Minister Kelly O’Dwyer says employers deliberately not paying their workers’ super entitlements are “robbing” their staff of wages.

The ATO currently receives 20,000 reports of possible non-payment from employees or former employees per year.

The government is so serious about solving this issue, that they have introduced a new bill which threatens directors with jail-time if they don’t pay their employees super.

So what’s the problem exactly?

EMPLOYEE VS CONTRACTOR

If you employ someone as PAYG (i.e. they get a payslip each pay cycle), and they’re over 18 and earning more than $450 gross a month, then it’s pretty much a no-brainer – they’re an employee and you have to pay them superannuation – there’s no discussion or confusion.

The apparent confusion begins when someone is a freelancer or contractor, and is sending a company an invoice from their Sole Trader ABN.

The ATO also has another video discussing “Employee vs Contractor – How to get it right”.

To quote the ATO:

Contractors paid mainly for their labour are employees for superannuation guarantee purposes. This is the case even if the contractor quotes an Australian Business Number (ABN).

You must make super contributions for these individuals if you pay them:

  • under a verbal or written contract that is wholly or principally for their labour - that is, more than half the dollar value of the contract is for their labour
  • for their personal labour and skills - which may include physical labour, mental effort or artistic effort - and not to achieve a result
  • to perform the contract work personally - that is, they must not delegate.

If you make a contract with someone other than the person who’ll actually provide the labour - for example, with a company, trust or a partnership - you don’t pay that person super.

The ATO has a employee/contractor decision tool and a superannuation guarantee eligibility decision tool on their website.

The Australian Government also has an Independent contractors decision tool on their Business website.

Long story short, in MOST cases, if you’re employing a contractor that’s invoicing with a sole trader ABN, if they’re work is “wholly or principally for their labour” (i.e. a gaffer, grip, sound recordist, makeup artist, etc.), and the employee/contractor decision tool and superannuation guarantee eligibility decision tool confirm your suspicions, then you should be paying them superannuation.

If you’re unsure, use the tools above, or better yet – contact the ATO – they’re super friendly and super helpful.

The ATO are on Twitter. They have a Live Chat. They have hundreds of hours of content on YouTube. Even if you don’t like talking to people over the phone – there are plenty of ways to easily communicate with the ATO.

If you need superannuation advice from the ATO, I would suggest completing this form, so that their early engagement team can get back to you promptly.

PTY LTD CoMPANIES

To quote the ATO:

Companies, trusts and partnerships are always contractors. An employee must be a person. If you’ve hired a company, trust or partnership to do the work, then it is a contracting relationship for tax and super purposes. The people who actually do the work may be directors, partners or employees of the contractor but they’re not your employees.

This seems pretty straight forward, HOWEVER, if you use the Employee/contractor decision tool and tick “A Company” in answer to “Who do you pay to do the work?”, and “Yes” for “Is the agreement between your business and the individual worker?” – then the decision tool will tell you that you do need to pay the worker superannuation. This is just plain confusing!

Although there are some Employee or Contractor case studies on the ATO website, there’s nothing on there that’s specific to the Film & Television industry, so I contacted the ATO directly with a simple scenario:

Let’s say I have a sound recordist in the Film & Television Industry. His name is Chris. He has his own PTY LTD company called Sound Company Pty Ltd. Production Company Pty Ltd would like to hire Chris for an upcoming television commercial. It’s a one off job, and he’s being paid a daily rate, plus equipment hire fees. Chris will invoice via his company, Sound Company Pty Ltd. Is Production Company Pty Ltd required to pay superannuation to Chris?

The ATO team were fantastic, and got back to me very quickly with a detailed reply. But before I share what they told me, here’s another disclaimer:

The ATO is unable to authorise or certify any guidance posted in a public forum outside of the ATO Website, ATO Community forums or ATO social media platforms.

However, the references to relevant paragraphs of Superannuation Guarantee Rulings SGR 2005/1, SGR 2005/2 and SGR 2009/1 can be relied upon as administratively binding on the Commissioner.

By contrast, the application of these Rulings and section 12 of the SGAA 1992 to your hypothetical example should be considered general guidance only and is not binding on the Commissioner.

This means that if a taxpayer wishes to utilise the information posted on your blog to understand their obligations, that taxpayer should apply the Rulings and any guidance available on the ATO Website to their specific circumstances.

If a taxpayer remains unsure of their obligations and is seeking binding advice, they are able to apply for administratively binding advice (‘ABA’). Please visit the ATO website and search for Quick Code ‘QC 40439’ for further information.

Advice and Guidance

Practice Statement Law Administration PS LA 2008/3 Provision of advice and guidance by the ATO outlines the forms of advice and guidance provided by the ATO and the level of protection available to taxpayers.

Please refer to paragraphs 73 to 79 of PS LA 2008/3 for further information on the level of protection provided by Superannuation Guarantee Rulings.

…and with that out of the way, here’s their awesome reply:

As discussed, please see the below guidance in relation to the status of a worker for the purposes of section 12 of the Superannuation Guarantee (Administration) Act 1992 (‘SGAA 1992’).

Please note that this guidance is general in nature and is not binding on the Commissioner.

SGR 2005/1

Superannuation Guarantee Ruling SGR 2005/1 Superannuation guarantee: who is an employee? (‘SGR 2005/1’) explains when an individual is considered to be an ‘employee’ under section 12 of the SGAA 1992.

Paragraphs 13 to 15 of SGR 2005/1 state the following with respect to individuals performing work through a company, trust or partnership:

  1. Where an individual performs work for another party through an entity such as a company or trust, there is no employer-employee relationship between the individual and the other party for the purposes of the SGAA, either at common law or under the extended definition of employee. This is because the company or trust (not the individual) has entered into an agreement rather than the individual. However, the individual may be the employee of the intermediary company or trust, depending on the terms of the arrangement.
  2. If a partnership has contracted to provide services, then the person who actually does the work is not the employee of the other party to the contract. This is so even if the worker is a partner and even if the contract requires the partner to do the work. However, if partners contract outside the partnership in their own personal capacity to provide their labour to fulfil a contractual obligation, they can be employees of the other party to the contract.
  3. A partner in a partnership is not an employee of the partnership.

In your hypothetical example, a production company (‘the Principal’) has engaged a sound recordist (‘the Worker’) to perform work for an upcoming television commercial. The Worker has a company (‘the Company’) and the Company invoices the Principal for any work performed. Payments for work performed are made by the Principal to the Company bank account supplied on the invoices.

In those circumstances, there is no employer-employee relationship between the Principal and the Worker for the purposes of the SGAA 1992, either at common law or under the extended definition of employee. This is because the Company has entered into an agreement rather than the Worker.

Subsection 12(2) of the SGAA 1992

Subsection 12(2) of the SGAA 1992 provides that “a person who is entitled to payment for the performance of duties as a member of the executive body (whether described as the board of directors or otherwise) of a body corporate is, in relation to those duties, an employee of the body corporate”.

If the Worker is entitled to payment for the performance of duties as a director of their Company, then the Worker may be an employee of the Company for the purposes of section 12 of the SGAA 1992.

SGR 2005/2

Superannuation Guarantee Ruling SGR 2005/2 Superannuation guarantee: work arranged by intermediaries (‘SGR 2005/2’) explains the Commissioner’s view of how the definitions of ’employer’ and ’employee’ in the SGAA 1992 apply to contractual and working arrangements involving three (or more) parties.

Paragraph 17 of SGR 2005/2 states the following:

  1. If a worker is not contracted personally to perform work or services but via an interposed entity such as a company or trust, neither the end-user nor the intermediary is the employer of the worker, because any contract they have is with the interposed entity and not with the worker. The worker may be the employee of the interposed entity.

In your hypothetical example, the production company (‘the end-user’) has contracted with a Company (‘the interposed entity’) and not with the Worker personally, therefore the end-user is not the employer of the Worker.

Paragraph 32 of SGR 2005/2 states the following:

  1. In employment arrangements involving an intermediary firm, a worker and an end-user, more than one contract is often formed. In these arrangements, it is first necessary to determine whether a legal relationship exists for the performance of work and with whom it exists. Only after this has been established can consideration be given to the issue of whether the relationship is one of employment or of some other kind.

Paragraphs 34 to 39 of SGR 2005/2 provide guidance on how to determine whether a legal relationship or contract for the performance of work exists between two parties.

In your hypothetical example, the legal relationship is evidenced by the invoices supplied by the interposed entity to the end-user for work performed. You have advised that there is no other agreement between the end-user and the Worker.

Paragraph 57 of SGR 2005/2 provides that a legal relationship cannot be inferred between the end-user and the Worker merely on the basis of common law factors of employment, such as whether the end-user exercises day-to-day or practical control over the Worker.

Subsection 12(8) of the SGAA 1992

Subsection 12(8) of the SGAA 1992 provides that the following persons are employees for the purposes of SGAA 1992:

(a) a person who is paid to perform or present, or to participate in the performance or presentation of, any music, play, dance, entertainment, sport, display or promotional activity or any similar activity involving the exercise of intellectual, artistic, musical, physical or other personal skills is an employee of the person liable to make the payment;

(b) a person who is paid to provide services in connection with an activity referred to in paragraph (a) is an employee of the person liable to make the payment;

(c) a person who is paid to perform services in, or in connection with, the making of any film, tape or disc or of any television or radio broadcast is an employee of the person liable to make the payment.

The cumulative effect of subsection 12(8) of the SGAA 1992 is that workers engaged in the film and television industry, who may perform services in or in connection with the activities outlined above, will be specifically defined as an employee for the purposes of the SGAA 1992.

In those circumstances, it is not relevant whether the common law factors of employment are present or whether the worker is engaged wholly or principally for labour.

It is also not relevant whether the worker holds an ABN, as in accordance with paragraph 16 of SGR 2005/1 a person who holds an ABN may still be an employee for the purposes of the SGAA 1992.

SGR 2009/1

Superannuation Guarantee Ruling SGR 2009/1 Superannuation guarantee: payments made to sportspersons (‘SGR 2009/1’) explains the Commissioner’s view of how the definition of ’employee’ contained in subsection 12(8) of the SGAA 1992 applies to sportspersons and persons providing services in connection with sporting activities.

SGR 2009/1 does not specifically deal with artists, musicians or other performers, however paragraph 114 of SGR 2009/1 states the following with respect to sportspersons paid through third parties:

  1. It is noted that in many situations sportspersons are engaged via a company or trust, in which case, it will often be the company or trust which is paid so that the sportsperson will play or compete. In such situations due to the interposition of the third party (the company or trust) between the payer and the sportsperson, the result may be that no employment relationship exists under the SGAA between that payer and the sportsperson. However, the sportsperson may be the employee of the intermediary company or trust, depending on the terms of the arrangement.

As previously outlined in SGR 2005/1 and SGR 2005/2, paragraph 114 of SGR 2009/1 confirms that a Worker who performs services for a Principal via an interposed entity (i.e. a company) is not an employee of the Principal for the purposes of the SGAA 1992.

This is regardless of whether the Worker performs services in or in connection with the activities outlined in subsection 12(8) of the SGAA 1992.

Administratively Binding Advice

If you are seeking binding advice with respect to the status of a worker for SG purposes, you are able to apply for administratively binding advice (‘ABA’). Please visit the ATO website and search for Quick Code ‘QC 40439’ for further information.

ATO Legal Database

Please see the below links to relevant legislation and rulings on the ATO website:

Long story short – if you employ a sound recordist (for example), that has their own PTY LTD company, then YOUR company is employing THEIR company, and THEIR company is responsible for any superannuation contributions to the sound recordist.

However, this means that if the same sound recordist invoiced via a Sole Trader ABN instead of via their PTY LTD company – they would get paid superannuation – meaning in the long term they get more money – so it’s reasonable and fair for PTY LTD companies to charge more money on their invoice to allow for this – but this is by commercial negotiation.

The Australian Screen Editors state on their public rate card that:

For Pty Ltd Companies add an additional 17.5% - 30% depending on circumstances.

There’s also nothing stopping a sound recordist from doing PAYG for the labour, then invoicing from their PTY LTD company for any equipment.

Freelance Promotions, the go-to TVC crewing agency in Melbourne, note on their rate card that:

Higher rates are usually charged by assistants who bill as P/L companies & cover super, insurance & workcover costs.

SUPER FOR FILM CREW

Most crew working in Film & Television will be working within the Motion Picture Production Collective Agreement (MPPCA) and/or the Broadcasting and Recorded Entertainment Award 2010 (BREA).

The MPPCA states:

17. SUPERANNUATION

(a) In this clause:

(i) “the Act” means the Superannuation Guarantee (Administration) Act 1992;
(ii) “remuneration” means the employee’s gross agreed remuneration as defined in this Agreement;
(iii) “quarter” means a period of 3 months beginning on 1 January, 1 April, 1 July or 1 October. (iv) “contribution period” means the six-monthly period from 1 January to 30 June or 1 July to 31 December;
(v) “maximum contribution assessment amount” shall be equal to the sum of twice the maximum contribution base calculated pursuant to the Act for any quarter;
(vi) “the fund” means MEDIA Super, Australian Super, or any complying superannuation fund nominated by the employee and agreed by the Employer;
(vii) “superannuation contributions” means payments made by the Employer calculated pursuant to sub-clauses (b) and (c) below.

(b) In respect of each employee engaged under the terms of the Agreement, in addition to all other amounts payable under this Agreement the Employer shall pay into the employee’s account with the fund an additional amount equal to 9% of the employee’s remuneration up to the maximum contribution assessment amount for the contribution period. (The maximum quarterly contribution base amount for the financial year 2009/2010 is $40,170 therefore the maximum contribution assessment amount for any contribution period for the financial year 2009/2010 is $80,340.)

(c) Superannuation contributions must be made on the basis of each employee’s remuneration regardless of any minimum threshold prescribed by the Act.

(d) Superannuation contributions must be paid into the fund each month.

(e) It is the responsibility of the Employer to advise employees upon engagement of their entitlements in accordance with this clause. It is the responsibility of employees to provide details of their fund registration to the Employer or to complete fund registration documents as the case may be.

(f) Where a dispute arises as to the amount of superannuation contributions to be paid and such dispute cannot be resolved between the individual employee and the Employer then this dispute must be referred to authorised representatives of SPAA and MEAA who must endeavour to reach agreement. Should agreement not be reached the matter may be referred to Fair Work Australia in accordance with the terms of clause 39.

(g) Nothing in this clause will reduce any statutory obligation on the Employer to pay superannuation contributions on behalf of an employee under Superannuation Guarantee Legislation.

This means that production companies are required to pay crew superannuation even if they earn less than $450 gross a month. This is really important for entry-level crew who are doing a single day on a television show or feature film, for example. It also means that under the MPPCA, superannuation is paid on contracted hours (including contracted overtime). However, under the BREA, it is not paid on overtime.

For further information on this agreement, please contact Screen Producers Australia or the Media, Entertainment & Arts Alliance.

SUPER FOR ACTORS

In addition to having their own special tax rate, if an actor is employed under the Actors Television Programs Agreement (ATPA), or the Australian Feature Film Collective Agreement (AFFCA), they also have different superannuation rates than your average worker (including film and television crew), in a similar way that people working in the public sector also get a higher superannuation rate.

There a few important things to note, and it’s also important to be aware of the differences between the two agreements.

The AFFCA states:

(a) In addition to all other payments provided for by this Agreement, the Producer shall make a superannuation contribution pursuant to the Superannuation Guarantee Legislation to the Media Super or such other fund as nominated by the Artist on behalf of the Artist, at the rate of 10% on the following:

(i)  the Artist’s Composite Fee; and

(ii)  all regular contracted overtime (whether or not worked) noted at Clause 3 of the Performer’s Standard Contract (Schedule “A”) paid to the Artist for the duration of the engagement provided that if the total of (i) and (ii) above exceeds $240,000 paid by the Producer to the Artist in any one financial year the Producer will not be obliged to pay a superannuation contribution on the component of the Artist’s payment in excess of $240,000 in that financial year.

(b) Juvenile Artists shall not be entitled to the benefits of this clause unless:

(i) The Juvenile is engaged on a 12 week contract or longer; or
(ii) The Juvenile has been employed in the Entertainment Industry for a minimum of six professional engagements; or
(iii) The Juvenile has previously been employed in the entertainment industry for a minimum of 30 days.

(c) The Producer shall make contributions to any Artist over the age of 70, who would not otherwise have received a contribution as a consequence of section 27(1)(a) of the Superannuation Guarantee (Administration) Act 1992. Therefore the provision of section 27(1)(a) of the Superannuation Guarantee (Administration) Act 1992 will not apply to this agreement. In the event that a Producer is not able to make contributions to a superannuation fund on the Artists behalf the Producer will make a payment, equal to the required superannuation contribution identified in clause 40(a), directly to the Artist and will identify the payment on the Artists statement of earnings as a “superannuation payment.”

The ATPA on the other hand states:

(a) In addition to all other payments provided for by this Agreement, the Producer shall make superannuation contributions at a rate of 1% above the minimum superannuation guarantee contribution rate pursuant to the Superannuation Guarantee Legislation to Media Super on behalf of the Performer. Superannuation guarantee contribution rates for Performers will be based on a Performer’s Total Fee.

(b) If the aggregate of the Performer’s Total Fee paid by that Producer to the Performer exceeds $200,000.00 in any one financial year, the Producer will not be obliged to pay a superannuation contribution on the component of the Performer’s Total Fee in excess of $200,000 in that financial year.

(c) Juvenile Artists shall not be entitled to the benefits of this clause unless:

(i) The Juvenile is engaged on a 12 week contract or longer; or
(ii) The Juvenile has been employed in the Entertainment Industry for a minimum of six professional engagements; or
(iii) The Juvenile has previously been employed in the entertainment industry for a minimum of 30 days.

(c) The Producer shall make contributions to any Artist over the age of 70, who would not otherwise have received a contribution as a consequence of section 27(1)(a) of the Superannuation Guarantee (Administration) Act 1992. Therefore the provision of section 27(1)(a) of the Superannuation Guarantee (Administration) Act 1992 will not apply to this agreement. In the event that a Producer is not able to make contributions to a superannuation fund on the Artists behalf the Producer will make a payment, equal to the required superannuation contribution identified in clause 40(a), directly to the Artist and will identify the payment on the Artists statement of earnings as a “superannuation payment.”

Long story short – with both agreements, even if you’re actor is over 70, you still need to pay them superannuation. If you’re doing a film the actors superannuation rate is 10%, however if you’re doing TV the actors superannuation rate is 10.5%.

For further information on these agreements, please contact Screen Producers Australia or the Media, Entertainment & Arts Alliance.

SUPER FOR ARTISTS

The National Association for the Visual Arts has a Fees & Wages PDF which covers superannuation. It’s well worth a read.

SUPER FOR EDITORS

The Australian Screen Editors has both a public and a members only rate card which also covers superannuation and the employer versus contractor discussion. This document is extremely detailed and well written, so well worth reading in detail.  Keep in mind however that the ASE is a guild and not a union, and they can not enforce rates and conditions.

MAKING LIFE EASIER FOR PRODUCTION COMPANIES

It’s really annoying and time consuming to have to chase up superannuation details for contractors and freelancers. When you send your ABN Sole Trader invoice, please make sure you also send a completed Super Choice form along with a Tax File Number declaration (as we need your Tax File Number & Date of Birth for Superannuation processing). It’s also a good idea to include your superannuation details on your Tax Invoice, if you have a Sole Trader ABN, as it will make the production companies book keeper very happy.

PENALTIES FOR NOT PAYING SUPER

If a company does not meet their super guarantee obligations, they may be liable for a range of penalties or charges on top of the super guarantee charge. Interest can be charged, as well an Administrative penalty, and fines for failing to keep records, failing to offer an employee a choice of super, failing to pass on a tax file number and failing to provide an SGC statement when required. This can add up REALLY quickly.

Swinburne University recently underpaid their staff by $3.66m. This number is made up of approximately $3.66 million owed to staff in underpaid superannuation ($2.13 million) and $1.53 million in interest.

The director of a company that fails to meet an SGC liability in full by the due date automatically becomes personally liable for a penalty equal to the unpaid amount.

For further information refer to the ATO’s page on Penalties, amendments and objections.

WHAT DO I DO IF I’M OWED SUPER?

The first step is always to contact your employer, and explain the situation. Given how long this blog post already is, you can see just how complicated and confusing superannuation can be – so chances are your employer was just mis-informed, or made an honest mistake, and will happily help you resolve.

Failing that the ATO has an Unpaid Super guide to help you investigate the situation.

Importantly, on 24 May 2018, Minister for Revenue and Financial Services announced the commencement of a 12 month Superannuation Guarantee Amnesty (code name: “The Amnesty”).

The Amnesty is a one-off opportunity for employers to self-correct past super guarantee non-compliance without penalty.

Subject to the passage of legislation, the Amnesty will be available from 24 May 2018 to 23 May 2019. However, even though the legislation has not been passed but you can access this Amnesty now.

According to the ATO, employers who are not up-to-date with their super guarantee payments and who don’t come forward during the Amnesty may face higher penalties in the future.

UPDATE (SEPTEMBER 2019): The legislation failed to pass through parliament, however on 18 September 2019, the legislation was reintroduced. You can read more about this here.

INSURANCE & WORKERS COMP

If you’re working as a contractor or run your own PTY LTD, it’s also really important to know and understand the implications when it comes to insurance (including, but not limited to Public Liability & Professional Indemnity insurance) and also Workers Compensation (which varies from state to state in Australia – just to make the whole topic extra confusing). It’s vital that you know what policy you’re covered under, so that if something unfortunate and unexpected does happen, you don’t have to worry about the insurance side of things.

WorkSafe Victoria has some information on determining if someone is considered a worker by WorkSafe.

The Fair Work Ombudsman has links to all the individual states and territories regulators for further information.

SUGGESTIONS FOR THE ATO & WIDER INDUSTRY

As you can see Superannuation is a fairly complex and complicated topic, especially for those of us in the Film & Television industries.

Here’s some things I’d LOVE to see implemented by the ATO & Industry Guilds & Unions:

  • I would love for the ATO to release some superannuation case studies on their website that specifically address those working in Film & Television (similar to the case studies you’ll find here).
  • As discussed above, the Employee/contractor decision tool can sometimes give some misleading results. I would love to ATO to add some further detail and clarification to the tool.
  • I would love the Australian Screen Editors (ASE) to either release their full rate card publicly, or at the very least, provide the full rate card to all Screen Producer Australia (SPA) members. What the ASE has done with their full rate card is incredibly awesome and very comprehensive – and it seems such a shame to restrict it’s access to just full fee paying ASE members. I personally believe it would be WAY more beneficial to the filmmaking community if producers and production companies had easy access to this document. I will be actively pushing this with the ASE.
  • I would love for the ATO to run some workshops in conjunction with Screen Producers Australia, Screen Australia and Film Victoria on superannuation, and Workers Comp insurance for our industry.

WHERE DO I LEARN MORE?

There is a HEAP of information on the ATO website.

The ATO offers a Super guarantee client health check website and downloadable PDF too.

The Australian Securities and Investments Commission also have a dedicated Superannuation & Retirement page, which links to a useful Super decisions booklet (PDF).

Arts Law Centre of Australia have a detailed Superannuation Information Sheet on their website.

Media Super is the industry super fund for Australia’s print, media, creative and digital sectors – they have a tonne of useful information on their website. They also have a page dedicated to Freelance & Self-Employed individuals.

If you’re a member of Screen Producers Australia then you’re able to get free advice from SPA’s Legal & Business Affairs guru.

It’s also VITAL that you have a good entertainment accountant – the MEAA has some Victorian recommendations here and some NSW recommendations here.

If you have any questions, feel free to post a comment below.

I hope this blog post has been useful!

Best Regards, Chris!