The government has introduced legislation surrounding the method of payment for superannuation contributions. This legislation is called “SuperStream” and applies to employers, employees and superannuation funds (i.e. self-managed superannuation funds).
Self-Managed Superannuation Funds
A self-managed superannuation fund (SMSF) must be able to receive employer contributions and the associated data electronically using the standard SuperStream format. Therefore, the members of a SMSF must obtain an Electronic Service Address (ESA) in order to comply with Super Stream.
They must then inform their employers of the SMSF’s bank account details, ABN and ESA.
The main benefits of SuperStream for SMSFs include the following:
- timely and reliable flow of payments
- fewer data and payments errors, with greater information about contributions
- provides an electronic record to support reporting obligations
It is important to note that SuperStream is only applicable for members who receive super guarantee from an employer. SuperStream registration is not required in the following circumstances:
- members do not receive any employer contributions
- members receive employer contributions from a related party (i.e. Family Trust)
- members make personal contributions or rollovers to an SMSF
Employers must pay super contributions for employees electronically (EFT or BPAY) and send the associated data electronically. The benefits derived from SuperStream from an employer’s perspective is as follows:
- employers can make all their contributions in a single transaction, even if they’re going to multiple super funds
- contributions and rollovers can be processed faster, more efficiently and with fewer errors
- people can be more reliably linked to their superannuation, reducing lost accounts and unclaimed monies
Key dates for employers to consider:
31 October 2015 – Large employers (20 or more employees) should have been using SuperSream since this date.
28th October 2016 – Small employers (19 or fewer employers) must meet the SuperStream standard by this date.
For further information on the relevant steps involved in registering for SuperStream, please visit - https://www.ato.gov.au/super/superstream/employers/employer-checklist--a-step-by-step-guide/
If you would like to discuss this article further, please contact Luke Guagliardo at RSM on 9920 7400 or email [email protected]