SuperStream Legislation Update
Posted by: on 4 August 2014 in Compliance
August 4 2015 – by Kate Anderson
You have probably heard about SuperStream by now, with the media recently picking up on the issue, and the ATO kicking off a communication campaign in June. For those who have been following SuperStream for some time, there were some changes to the program that you might have missed. There is now more time to comply, but that doesn’t mean you can take it off your ‘to-do’ list.
Changes to the start period
At the end of May, the ATO advised that some amendments had been made to the SuperStream legislation around start dates for the program, and when certain groups needed to be compliant.
- Large employers – companies with 20 or more employees now have from 1 July 2014 until 30 June 2015 to be compliant
- Small employers – companies with 19 or fewer employees have until 30 June 2016 to be compliant
- APRA funds – now have some more flexibility. They can start to work in the SuperStream standard from 3 November 2014, or can choose a start date in consultation with the ATO until 1 July 2015
So everyone can relax, right?
Not exactly. While the new dates provide much needed breathing space for companies, the extended period has been created due to the large amount of work that needs to be done across the superannuation industry to be compliant – and this includes employers.
The SuperStream standard removes much of the complexity in the system by imposing a single, mandatory set of rules for payments and data – a much needed improvement. However, this means that new data needs to be collected by employers, and existing data needs to be updated and fully complete.
Every superannuation fund has been allocated a Unique Superannuation Identifier, or USI. This means that employers will now need to collect (and maintain) USI information for every fund paid. This in effect, replaces the SPIN system, but most payroll and HR systems will need to be updated to take this into account.
TIP: consider where you currently collect and store superannuation data for employees (forms, spreadsheets, databases and payroll systems) and ensure that you are now able to store USI information.
Self-Managed Super Funds
The rapid rise in employee Self-Managed Super Funds (SMSFs) has seen complexity increase for employers. There is now a seemingly limitless list of potential recipients of superannuation payments to manage. On the receiving side, SMSFs also need to complete work in order to receive funds in the new SuperStream format. Each SMSF has similar requirements as the big super funds – full banking information, an Electronic Service Address Alias and an ABN. Employers need to store and maintain this data, which often means working with employees who prefer a ‘hands off’ approach to their SMSF.
TIP: Engage now with your employees that have an SMSF. You can help them understand their obligations (we have a helpful FAQ here) and explain that without a compliant SMSF, you will not be able to make superannuation payments.
Setting a date for SuperStream
If you belong to the group of employers that need to be ready by 1 July 2015, the time to start is now (perhaps once End of Year is complete!).
- If you manage your payments yourself, set up your plan and timeframes to be ready and compliant. Everything needs to be fully in place by end of June 2015.
- Alternatively, talk now with payroll software providers, payroll outsourcers and payment providers to understand what they will do, and what you will need to do.
Whether you in-house or outsource, you need to start collecting the new information as soon as possible. The earlier you have everything in place, the more time you will have to deal with any issues that may arise when you start operating to the standard.