In recent weeks a number of new pieces of superannuation legislation were passed through parliament and several others are approaching finalisation.
Protecting your super Bill
The main one that passed is called the Protecting Your Superannuation Package Bill 2018 and it focuses on protecting members’ balances from erosion by:
- Limiting fees on low balance accounts;
- Banning exit fees so that members can consolidate their accounts without disadvantage;
- Ensuring that arrangements for insurance in superannuation are appropriate so that members are not paying for insurance cover that they do not know about or premiums that inappropriately erode their retirement savings; and
- Strengthening the ATO’s role in reuniting small, inactive balances to reduce the costs to accounts of members who have multiple superannuation accounts.
New rules for employers about unpaid super close to finalisation
Two other pieces of superannuation legislation that are particularly relevant to employers are currently before the Senate and look likely to pass through Parliament soon.
One of these would introduce a one-off 12-month amnesty to encourage employers to correct historical non-compliance with their SG payment obligations. It also introduces increased penalties for employers who breach their SG obligations and on those who do not take advantage of the amnesty.
The other Bill will close loopholes for employers in relation to employees’ unpaid salary sacrifice contributions to their super.
A wake-up call for employers who are in breach of their SG obligations
Such legislation should provide a clear wake-up call for any employers who have breached their SG obligations. We remind employers that while the above Bills have not yet actually passed, currently employers are still subject to an audit and penalties from the ATO if they have not paid their employees’ super.
It is each employer’s obligation to ensure they and their payroll staff comply with these rules to avoid penalties.
We will provide employers with more information on the new super legislation in the near future.
The information contained in this article does not constitute financial product advice. REI Super does not give any warranty to the accuracy, completeness or currency of the information provided. Although REI Super makes every reasonable effort to maintain current and accurate information, you should be aware that there is still the possibility of inadvertent errors and technical inaccuracies. REI Superannuation Fund Pty Ltd ABN 68 056 044 770, AFSL 240569, RSE L0000314 Trustee of REI Super (ABN 76 641 658 449), SPIN REI0001AU, RSE R1000412. MySuper unique identifier 76641658449129.