Businesses need to have a new superannuation program in place by June 2015
Most business owners are expected implement a new system which changes the way to make superannuation contributions by the end of the year.
The Australian Tax Office (ATO) is introducing SuperStream which will change the way businesses make superannuation contributions in the future.
In cooperation with their service provider or default fund, employers can opt-in to use SuperStream from as early as July.
The ATO expects most large and medium employers will implement SuperStream between July and December of this year.
SuperStream introduces a new standard for all employers which involves making super contributions electronically with linked data and payments.
All super contributions are treated in the same way – whether sent to a default or choice fund, an APRA fund or self-managed superannuation fund (SMSF).
National Program Manager Data Standards & E-Commerce Philip Hind says the main benefit for employers is the SuperStream standard will simplify the employer experience and reduce costs by eliminating unnecessary variation and complexity that has crept into the system over recent years.
“The need for reform of Australia’s superannuation system was highlighted in the 2010 Cooper Review which found the existing processes made poor use of technology and there was no consistency in the data required and how funds deal with contributions,” he says.
“SuperStream is one of the most significant improvements to the compulsory superannuation system since its inception 20 years ago.
“All employers need to introduce changes in the way they currently make super contributions; although some who are already working electronically or have a clearing house partner will find these changes are relatively minor.”
The ATO is focused on awareness raising, education and support for employers during the first few years of SuperStream as the new standard is adopted.
“All large and medium-sized employers need to prepare now to ensure they’re ready to transition to SuperStream at the earliest available opportunity,” Hind says.
A large or medium employer must complete their implementation by no later than June 30 2015.
Small employers have another year before they commence using SuperStream but no later than June 30 2016.