From 1 July this year the way employers interact with superannuation funds to which they make contributions will change. The Government’s ‘SuperStream’ changes will require that every employer with 20 employees or more has an electronic service address for each superannuation fund to which that employer makes contributions. And yes, this includes where you own the business and it contributes to your own self-managed fund.
Small employers are not included in this system yet. The proposal is that they be given an additional year, to 1 July 2015, to comply. There is also a proposal that small employers will be able to utilise the free services offered by the Medicare Small Business Superannuation Clearing House to streamline their processing.
The idea behind this SuperStream change is to make the system electronic and use the Tax File Number of each member as the primary identifier. This, it is hoped, will make the system more efficient, prevent ‘lost’ accounts arising in the future and enable the Government to keep track more easily of exactly what is contributed for an individual no matter by whom or into which fund.
If you are an employer you need to ensure you have the fund details for each fund to which an employee wants you to contribute and that you have electronic access to communications with each fund. Particularly where some of your employer contributions go to self-managed funds it is in your interest to start organising this information as soon as you can to ensure you are ready for the 31 May 2014 data receipt deadline.
If you are operating your own self-managed fund you need to organise an electronic service address and gateway for employer messages unless your employer has less than 20 employees. Most self-managed funds deal closely with an accountant so this may well be your first port of call. Alternatively, Australia Post is offering this service to self-managed superannuation funds from 1 July this year.
If you are an accountant who deals with the administration of funds you will need to ensure all your SMSF clients are aware of the new rules and make proper arrangements for electronic access before 1 July where necessary.
If you would like more information on the new rules or you have any concerns about the structure and documentation for your self-managed superannuation fund Briony Hutchens can assist to ensure that your fund is operating properly and that your audit report to the ATO will show a clean bill of health.
This communication provides general information which is current as at the time of production. The information contained in this communication does not constitute advice and should not be relied upon as such. Professional advice should be sought prior to any action being taken in reliance on any of the information. Should you wish to discuss any matter raised in this article, or what it means for you, your business or your clients' businesses, please feel free to contact us.