As 30 June approaches, employers with 19 or fewer employees will need to ensure they are ready for SuperStream, a new reporting system for superannuation contributions.
SuperStream is a set of measures aimed at improving the efficiency of superannuation contribution payment and reporting between businesses and superannuation funds. The introduction of electronic payment and reporting of contributions is intended to realise the following benefits:
- Timely, accurate and faster processing of contributions and transactions
- Decrease in lost member accounts
- Decrease in duplicate member accounts
- Improved efficiency for employers and superannuation funds
- Employers only make one payment
The mandatory SuperStream program start date for larger employers was 31 October 2015. However a delayed start date was allowed for small employers with less than 20 employees. Small employers have until 30 June 2016 to ensure that they are SuperStream ready.
There are a variety of ways SuperStream can be implemented. For most employers their accounting software, such as MYOB or Xero, has this functionality inbuilt. If you are using desktop accounting software, it is important that this be updated to the latest version. Check with your payroll software provider to determine if they are supporting SuperStream and what updates may be required.
Businesses whose software does not have this capability, or who are paper based, can register with a superannuation payments clearing house. Once registered, the service provider’s online software can be accessed to report employee’s details. Larger superannuation funds may also offer a SuperStream solution.
The ATO offer a free superannuation clearing house to small businesses with 19 or fewer employees, or turnover of less than $2 million. Further details can be found here.
Personal superannuation contributions and contributions to a related Self Managed Superannuation Fund do not need to be reported (however contributions to arm’s length SMSFs must be reported).
Employers who make contributions to their employee’s SMSFs must obtain the following information:
- The SMSF Name and ABN
- The SMSF Bank account details
- The SMSF Electronic service address (ESA).
SMSFs are required to have an ESA to enable them to receive the data attached to superannuation contributions. If your employees are unsure of their SMSF’s ESA, they should check with their accountant or financial adviser.
If your business pays superannuation contributions on a monthly basis, ensure all superannuation payments are made and reported by the 28th of the following month. For businesses that pay on a quarterly basis, payment and reporting is due by the 28th of the month following the end of the quarter.
If you would like further information, the ATO’s employer checklist on SuperStream can be found here.
Still unsure? Baumgartners are able to assist you with any queries or with implementing SuperStream in your business. Please contact Julie Tse on 03 9851 9062 or Michael Cortis on 03 9851 9030 to discuss your circumstances.