This is an important reminder to all our clients, whether you are an employer, employee or trustee of a self-managed superannuation fund (SMSF).
SuperStream is a standard for processing superannuation data and payments electronically. It must be used by:
- employers
- self-managed super funds (SMSFs)
The start of this financial year (1 July 2015) heralded the start of SuperStream for small employers (with 19 or fewer employees) with deadline for implementation of of 30 June 2016.
Medium to large employers (with 20 or more employees) should already have been SuperStream ready from 31 October 2015.
SuperStream data is in a standard format so it can be transmitted consistently across the super system – between employers, funds, service providers and the ATO. The data is linked to the payment by a unique payment reference number.
This means:
- employers can make all their contributions in a single transaction, even if they’re going to multiple super funds
- contributions and rollovers can be processed faster, more efficiently and with fewer errors
- people can be more reliably linked to their super, reducing lost accounts and unclaimed monies.
What to do as an employer
SuperStream requires employers to send all super payments and employee information electronically in a standard format. Using it will be mandatory from 1 July 2016.
You can select how your business becomes SuperStream ready. Options include:
- a payroll system that meets the SuperStream standard (e.g. MYOB, Xero)
- your super fund’s online system
- a super clearing house
- a messaging portal.
You don’t need to use SuperStream for:
- contributions to your own self-managed super fund (SMSF) – i.e. if you’re a related-party employer – for example, if you’re an employee of your family business and your super guarantee contributions go to your SMSF
- personal contributions – for example, if you’re a sole trader and you contribute to a super fund for yourself.
For these types of contributions you can continue using your previous processes because these are considered exempt contributions.
Payroll system
If you use a payroll system, check with your system provider that it is SuperStream ready. You may need to update your system.
Some payroll systems cover data and payments, and some are data only, which means you may need to make payments to each fund separately. Either way the payment must be electronic (EFT or BPAY).
Your super fund’s online system
Large super funds have online payment services you can use. Check with your fund.
Super clearing house
A clearing house pays super to your employees’ funds for you. You send a single electronic payment to the clearing house, together with the contribution data for all your employees, and the clearing house does the rest.
If you have 19 or fewer employees, or a turnover of less than $2 million a year, you can use the ATO’s free Small Business Super Clearing House.
Messaging Portal
A messaging portal can convert contribution data for your employees to a SuperStream compliant format and send it to the relevant funds for you. You still need to make one electronic payment. Talk to your messaging portal provider and financial institution.
Set-up is a one off task, and once done, using SuperStream for each payment cycle is simple.
Support is also available from your super fund, payroll system provider, messaging portal provider or by contacting your super clearing house.
What to do if you have a SMSF
All SMSF trustees must be able to receive super contribution payments and information sent using SuperStream when their employer starts using SuperStream. To be able to do this, each SMSF member will need to provide the SMSF’s ABN, bank account and electronic service address (ESA) to their employer.
If you haven’t finalised your SuperStream preparations, there are some things you need to do.
- Obtain an ESA– SMSF trustees need an ESA to receive contribution information electronically. If we act as tax agent for your SMSF you can use the ESA provided to us by our software provider BGL. This is If your employer asks for the gateway it is AUSTRALIA POST. If trustees choose to engage a SMSF message provider directly you will need to register your SMSF with the provider – a small fee may be payable for this service.
- Provide bank account details– SMSFs need to have nominated a fund bank account to receive employer contribution payments electronically. The introduction of SuperStream means no more cheques sent to your fund.
- Provide an ABN– If you do not know your fund’s ABN, let us know and we will provide this to you.
Once you have all of this information, each member of your SMSF will need to provide it to their employer. You should contact your employer about when they plan to make their first SuperStream contribution and make sure you provide your SMSF’s ABN, ESA and bank account details as soon as possible beforehand.
If your employer doesn’t have this information by the time they make their first SuperStream payment, your employer won’t be able to send the contribution to your SMSF and your SMSF won’t meet its super obligations.
We encourage you to ensure you are SuperStream compliant by the deadline of 30 June 2016 and contact us immediately if you have any further questions.
