ATO warns on super obligations

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The ATO has warned dental practices to be abreast of changes to super obligations.
The ATO has warned dental practices to be abreast of changes to super obligations.

The ATO has warned that employers in the dental industry need to ensure they are aware of their new super obligations and consider making any necessary changes now to ensure they are ready, according to the Australian Taxation Office.

The superannuation data and e-commerce standard is being introduced to make it possible for employers to send contributions to all funds in one standard electronic format.

Alison Lendon, Deputy Commissioner, Superannuation, said dental practices that employ 20 or more people need to act most swiftly, with the introduction of the data and e-commerce standard (the Standard) on 1 July, 2014.

“The time to prepare for the Standard is now,” Ms Lendon said.

“If you think your business will need to update software or systems, you should start planning now to ensure you’re ready on time.”

“If you prefer to process your employer compulsory super contributions yourself, you can work with your default super fund or payroll supplier to meet the new data and e-commerce standard. Other partners, including accountants and clearing houses, will be able to help as well.”

The standard is part of the Government’s SuperStream measures to ensure all movements of money within the super system are transferred electronically.

Once implemented, the standard will provide a consistent and reliable method for processing superannuation payments electronically and result in:

         fewer data quality issues

         a simpler, more consistent contribution process

         fewer lost accounts and unclaimed monies

         faster processing of employees’ money into their super accounts

         lower overall processing costs.

 

“The standard is about moving super into the 21st century and removing much of the administrative burden and the inefficiencies faced by employers,” Ms Lendon said.

“The goal is to improve the efficiency of the superannuation system, to improve the timeliness of processing of contributions and reduce the number of lost accounts and unclaimed monies.”

Employers with 19 or fewer employees must comply with the standard by 1 July 2015.

“Small businesses have more time to prepare,” Ms Lendon said.

“However, it’s important to be aware of what’s coming up and know what changes you will have to eventually make.”

The following reforms are already in effect, from 1 July this year:

     An increase in the compulsory super payments (Super Guarantee) employers make on behalf of their eligible employees from nine per cent to 9.25 per cent.

     The existing age limit for employee super guarantee (SG) eligibility was removed, meaning employers must now make SG payments for employees aged 70 and over.

MySuper is a new, simple and cost-effective superannuation product that will replace existing default super fund products.

 

Ms Lendon said employers must make super guarantee payments for employees who have not selected a preferred fund, to a fund that offers a MySuper product, by 1 January 2014.

“For most employers, it is expected that their existing default fund will offer a MySuper product,” Ms Lendon said.

“These employers will not have to make any change to the payment of superannuation guarantee contributions. Your fund should contact you to advise that they will offer MySuper product and any changes to the entitlements of your employees.

“If you are unsure, or want more information on the MySuper product offered by your default fund, you should contact the fund.”

Funds were allowed to start offering MySuper products from 1 July 2013.

 

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