Under the Superannuation Guarantee (Administration) Act 1992, employers who pay an employee $450 in a given month are liable to make a contribution of 9.25% to a complying superannuation fund on their behalf. The super guarantee is designed to boost national savings and encourage self funded retirement among the working populations.
The maximum contribution base is the cap on the compulsory contributions that must be made. In the 2010 year, that was $3,615.30 per quarter. An employer does not have to pay more than the maximum contribution in any given quarter, however they may choose to do so voluntarily. Employees on high incomes should be careful when negotiating their package that they do not have more than $25,000 of super contributions made, as all employer contributions count toward the concessional contributions cap.