Superannuation for contractors

Contractors work for others under a contract for services, rather than as an employee. Depending on the structure of their engagement, contractors may be responsible for their own super contributions.

Independent contractors: If you operate as an independent contractor (for example, as a sole trader), you are generally responsible for making your own super contributions. You can make regular or lump-sum contributions, and you may be able to claim a tax deduction.
Contractors paid mainly for labour: If you’re paid mainly for your personal labour or skills, the business hiring you may be required to pay your super. This applies even if you have an ABN or invoice for your work.

Superannuation in the gig economy

Gig economy workers typically have short-term, flexible, freelance jobs. Often these jobs come through purpose-built digital platforms and mobile apps, covering areas such as rideshare, food delivery, dog walking, babysitting and DIY help.

What does working in the gig economy mean for your super?

Let’s start by looking at whether you’re considered an ‘independent contractor’ or an ‘employee’.

If you’re considered an ‘independent contractor’

If you're self-employed or operating as a sole trader, you may be considered an independent contractor. Right now, most gig workers are classified as independent contractors, which means you’re responsible for managing your own superannuation.

As an independent contractor, you’re generally not required to make compulsory SG contributions for yourself. That means any super you contribute is entirely up to you – it’s not a legal obligation. But it’s still a smart move to plan ahead, so you don’t miss out on long-term retirement benefits.

If you’re considered an ‘employee’

If you’re a gig worker and are considered an ‘employee’ (as opposed to an independent contractor), you should receive SG contributions from your employer. So it can be worth checking to make sure those payments are being made – and if not, how much you’re owed.

An important update

From 26 August 2024, some gig workers may be considered ‘employee-like workers’. This shift is significant because increasing numbers of gig workers may now be entitled to the minimum wage, penalty rates and SG contributions.

Still not sure if you’re entitled to super?

Still need help figuring out whether you’re entitled to super?

If you're not sure, you can use the ATO’s 'Am I entitled to super?' tool to find out whether you are entitled to super from your employer.

Conclusion

Superannuation is an important part of your financial future, whether you’re a contractor or gig economy worker. Understanding your obligations and taking proactive steps will help you build retirement savings.

Do contractors and gig economy workers receive super?