Changes for Self-managed Superannuation Funds

Starting from 1 July 2014, SMSFs will be required to receive contributions electronically from employers. For employers with 19 or fewer employees, the start date is delayed to 1 July 2015.

To assist the employers, SMSF trustees will need to obtain an electronic service address for the delivery of contribution messages. SMSFs will then need to provide their ABN, bank account details and electronic service addresses to the employer.  Note, that without an electronic service address no contributions to the fund can be received.

Please note, SuperStream will not affect your SMSF if it:

  • does not receive any employer contributions
  • only receives personal contributions made by members
  • only receives contributions from related-party employers.

An electronic service address is used to receive electronic contributions messages from the employer. It can be in the format of a uniform resource locator (URL), internet protocol address, or an alias for SMSFs.

The electronic service address (alias) is an easily recognisable word format that represents the URL or IP address of the SMSF messaging provider.

If you are an SMSF trustee, you will need to obtain an electronic service address alias from an SMSF messaging provider before the employer can send contributions to the SMSF electronically. An electronic service address (alias) can be obtained from an SMSF messaging provider.

If your SMSF already uses professional service providers, you may have multiple options available to you for obtaining an electronic service address.

If your SMSF does not use professional service providers, you will need to register with an SMSF messaging provider. An SMSF messaging provider will be able to receive contributions messages your employer sends electronically using the SuperStream standard. Your messaging provider will pass messages to you. The ATO has produced a register of SMSF messaging providers. We recommend at this stage Australia Post, the contact details for which are 13 76 78, or superannuation@auspost.com.au.

Changes for business owners

From 1st July 2014, employers with more than 20 employees are required to provide timely information about superannuation contributions they have made. If you have 19 or fewer employees (small employer), SuperStream starts from 1 July 2015. You have until 30 June 2016 to meet the SuperStream requirements when sending superannuation contributions on behalf of your employees

SuperStream or Data and Payment Standards, is a new process requiring employers to pay their employees superannuation contributions using the government’s new data standards. In layman’s terms, it means all superannuation contributions need to be made and recorded electronically – no more cheque writing.

Employers will have to comply with 2 things under SuperStream:

  1. The payment must be made electronically to the nominated superfund.
  2. Details of the payment transaction, such as employee name, Tax File Number and Super fund member number are also sent to the superfund.

Options

Employers have options for meeting SuperStream – either using software that conforms to SuperStream; or using a service provider who can meet SuperStream on your behalf. We recommend that you start investigating your options now. Please note that without one of the options listed below, superannuation contributions cannot made.

Your options may include:

  • upgrading your payroll software – MYOB, for example, have released a Pay Super feature which is free for AccountRight Live and AccountRight v19, which will enable superannuation contributions to be made which meet the SuperStream regulations.
  • 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). – the ATO have listed several organisations providing this service