Important Information About Employer Superannuation Contributions29-Oct-2014
Are you SuperStream Ready?
The ATO has recently implemented changes to employer super contributions that will affect you. This new reform is known as SuperStream.
What is SuperStream?
SuperStream is a government reform aimed at improving the efficiency of the superannuation system. Under SuperStream, employers must report super contributions on behalf of their employees by submitting data and payment details electronically in accordance with the SuperStream standard. All superannuation funds, including SMSFs, must receive contribution details electronically in accordance with this standard.
If you are a medium to large employer (20 or more employees), superstream started from 1/7/2014. You will need to start implementation straight away as you have until 30/6/2015 to meet the superstream requirements when sending superannuation contributions on behalf of your employees.
If you are a small employer (19 or fewer employees), superstream starts from 1/7/2015. You have until 30/6/2016 to meet the superstream requirements when sending superannuation contributions on behalf of your employees. Note that you can voluntarily adopt superstream from 1/7/2014 if you are ready.
What are my options for meeting SuperStream?
Every business is different, so there’s no one-size-fits-all approach to adopting SuperStream. Employers have options for meeting SuperStream. Your options may include:
• Upgrading your payroll software
• Using an outsourced payroll function or other service provider
• Using a commercial clearing house or the free Small Business Superannuation Clearing House (19 or fewer employees).
What do I need to do to meet my SuperStream obligations?
You will need to collect from your employee the following information:
• For all Funds:
o Fund’s ABN
o Employee’s TFN
• For SMSF’s
o Electronic Service Address (ESA)
o Bank’s BSB and Account Number
Can I continue to make contributions using cheques or send paper notices or forms?
The short answer is NO. If you continue to send cheques and paper notices or correspondence, you will not be compliant with SuperStream and may face penalties under the law. You must send linked electronic payments and messages (in the approved format). These messages, along with the payment details, provide funds with the information they need to allocate contributions and reconcile payments for members efficiently and reliably. If you are unable to handle electronic payments yourself, you may engage an agent (such as a clearing house) who can accept cheque payments and who will then transact electronically using SuperStream on your behalf.
What does this mean for SMSFs?
For SMSF's to comply with the standard, every SMSF that receives employer contributions will need an electronic service address (ESA) and the software to receive their SuperStream data. Trustees will need to provide this address to their employer in order to receive their contributions. If you currently have a SMSF that is managed by us, please contact us for your ESA. If you have a SMSF that is not managed by us, you will need to contact your accountant to obtain these details.
Software providers makes the SuperStream transition for employers easy!
• If you are on a premium plan this service is free. You need to complete the automatic superannuation payments registration and direct debit request forms.
• To process through MYOB, you need to apply for the M-Powered Superannuation Service. A fee will be charged for this function.
• Report and pay online via each employee’s superannuation fund website
• Register for a clearing house
Should you require any further information on SuperStream, please do not hesitate to contact us.