Employers must be prepared for 1 November 2021 when super fund choice rules change to comply with the Government’s new “super stapling” requirements.
What is ‘super stapling’?
Currently, employers must offer eligible new employees a choice of fund when making super guarantee contributions. In the event that a fund is not chosen, employers must pay this super into a default fund.
Many employees fail to nominate a fund and incur unnecessary costs in setting up and maintaining multiple default accounts. To avoid this, the Government is introducing measures that will require an employer to pay super into an existing account held by the employee, known as a ‘stapled super fund’.
From 1 November 2021, for new eligible employees that do not make a choice, employers will need to check whether these employees have stapled super funds.
What’s required from 1 November?
To ensure you are paying super into the correct fund for your new employee, there are a number of steps to take:In summary, options for the employer to take are as follows:
- Continue offering new employees a choice of super fund via a Super Standard Choice form. If the employee chooses a super fund, pay into the account advised on the form;
- If the employee does not choose a super fund, request stapled super fund details using the ATO’s online services either directly or via the employer’s tax agent. If the employee has a stapled super fund, pay into this account;
- If the employee does not have a stapled super fund, then pay into a newly created default fund account.
The choice of super fund and stapled super fund obligations will need to be met by the quarterly due dates or penalties may apply.
Super payments and payroll
There are currently no changes you need to make in your payroll system for the introduction of the new super choice rules. Simply enter the super fund details for the new employee into your payroll system based on the super fund identified by following the above steps.
To learn more about the super choice rule changes and how they may impact your business, please contact Kristy Baxter or your Pilot Advisor on 07 3023 1300.