Is the super guarantee charge tax deductible?

Quarters up to 30 June 2026: nothing is deductible

This is the part that surprises most business owners. An on time super contribution is a normal business deduction. Once a quarter is late, the whole obligation becomes the super guarantee charge, and the law specifically denies a deduction for it. That includes all three components: the shortfall, the 10% nominal interest and the $20 per employee administration fee.

The same applies to the extras:

• A late contribution that you elect to offset against the SGC is not deductible either. You give up the deduction in exchange for reducing the charge.
• A late contribution that you do not offset, and instead carry forward against a future quarter, is deductible in the year the fund receives it.
• General interest charge on an unpaid SGC incurred since 1 July 2025 is not deductible, in line with the wider rule that ATO interest is no longer deductible.
• The Part 7 penalty is a penalty, so it is not deductible.

In money terms, a company on the 25% tax rate that misses $10,000 of super loses a $2,500 deduction on top of the higher charge. A sole trader on a higher marginal rate loses more.

Pay days from 1 July 2026: mostly deductible

Under payday super the government redesigned the charge and made most of it deductible, on the basis that the cost of enforcement should sit in the uplift rather than in lost deductions. The ATO's guidance sets out the split:

So the tax cost of a late pay period is far smaller than before, as long as you pay the assessed charge promptly. Leave it past the notice to pay and you add a non deductible penalty on top of non deductible interest. What payday super changes for late super is covered in more detail at what payday super changes.

Which rules apply to your debt

The line is the period the super relates to, not the date you paid or the date the ATO assessed you:

• Super for wages paid up to 30 June 2026 falls under the quarterly rules. The June 2026 quarter, due 28 July 2026, is the last of these. An SGC for that quarter is not deductible even though you deal with it after 1 July 2026.
• Super for pay days from 1 July 2026 falls under payday super, and the redesigned charge is deductible except for GIC and the late payment penalty.

If you are paying off a mix of old and new super debt, ask your accountant to keep the two streams separate in the accounts so the deductible part is claimed. And if the SGC is only one of several tax debts, look at the total picture on the can't pay your tax bill page before deciding what to pay first, because super carries personal liability risks that most other debts do not.

What to do next

1. Check which periods each late payment relates to, so you know whether the old or the new deductibility rule applies.
2. Do not offset a late contribution against an old quarter's SGC without comparing the saved charge against the lost deduction.
3. Ask your accountant to keep pre and post 1 July 2026 super debts separate in the accounts.
4. If a non deductible charge has left you short, look at a payment plan before the ATO moves to firmer action.

More questions: 8 Super guarantee charge questions questions answered · Full guide: Super guarantee charge (SGC)