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  • Superannuation: the big picture

    Find out how we work with the superannuation industry.

    On this page:

    Taxpayer protection

    We help superannuation funds and their members make informed decisions. We do this by providing greater transparency and finding effective ways to warn and prevent breaches of the law.

    Our goal is to provide trusted services and information to super fund members and the community through innovation and technology, for example:

    • ‘rollovers’ processed in three days (previously 30 days)
    • matching member TFNs with funds to ensure integrity in the system
    • shift from annual reporting to event-based reporting.

    Event-based reporting provides unprecedented opportunities to reinvent how we use data to support industry and members. Through shared information, we'll be able to change behaviour and prevent breaches of the law.

    From 1 July 2018, Single Touch Payroll (STP) became mandatory for employers that employed 20 or more employees (as at 1 April 2018). Payment information, such as salaries and wages, pay as you go (PAYG) withholding and super guarantee (SG) liability information is now provided to us at the same time an employee is paid.

    Combined with event-based reporting from funds STP creates visibility of non-payment or late payment of super entitlements and enable us to take prompt action protect taxpayers’ super.

    Recent reforms and new services

    A range of reforms have been delivered to benefit taxpayers.

    Event-based reporting

    Recently we worked with industry to transform the reporting of member account information from annual reporting to digital 'as it happens' observation and accountability. This involved shifting from an annual, aggregated report to transactional level, event-based reporting. This was supported by new transaction services such as the:

    • member account transaction service
    • member account attribute service.

    As of the end of February 2019, 45% of APRA funds will have completed their member account transaction service ‘on-boarding’.

    From a SG perspective, this will also:

    • provide visibility of employer contribution payments to fund members
    • potentially reveal SG payment data for 64% of APRA member accounts.

    Single Touch Payroll

    Along with event-based reporting from funds, STP reporting gives us better visibility of unpaid super to ensure employers are paying right amount.

    From 1 July 2019, all employers are required to report through STP.

    This means at the same time an employer runs their payroll, they will also be reporting an employee's:

    • salary and wages
    • pay as you go (PAYG) withholding
    • superannuation liability.

    Employees will be able to view their information reported through STP in almost real-time in ATO online services accessed through myGov.

    See also:

    SuperStream

    More than $1.5 billion has been invested in SuperStream by us and industry over the 2012–2018 financial years. Under SuperStream:

    • all super transactions are sent electronically
    • employers are required to pay super contributions on behalf of their employees by submitting data and payments electronically
    • all super funds, including SMSFs, must be able to receive contributions electronically
    • APRA-regulated funds are required to receive rollovers electronically.

    Up to 31 December 2016, SuperStream efficiencies were approximately $800 million per year, made up of:

    • $400 million per year for employers
    • $400 million per year for funds.

    More significantly, the estimated savings for members from this investment was $2.4 billion per annum.

    New systems and services

    New services and systems have been introduced to support positive outcomes for members and provide more efficiency in the super industry. They include:

    • TFN identifier – use of the Tax File Number (TFN) as an identifier and validation service for super funds
    • ATO SuperTICK service – giving funds the ability to check and correct TFNs in close to real-time
    • 10 million successful SuperTICK validations in the past 12 months – double what was achieved in the previous year
    • SuperMatch/SuperMatch2 – allowing super funds to proactively search for lost and unclaimed accounts on behalf of their members
    • successful searches increasing from 1 million to 2.5 million in the past 12 months – a good outcome for members.

    See also:

    Managing super via ATO online

    We support super fund members who make informed decisions and value the importance of super..

    An individual can check and manage their super using the ATO Online services on myGov. We are progressively adding to our online services, and increasing numbers of people are using them with over 5 million views in July 2019. Our services allow individuals to:

    • see details of both active and closed super accounts (back to 1 July 2018)
    • find super accounts they may have lost track of, and see any ATO held super
    • apply to consolidate their super accounts
    • view their employer contributions
    • apply for release of super on compassionate grounds
    • apply for the First Home Super Saver (FHSS) Scheme
    • create and manage a payment plan in respect of a FHSS tax notice of assessment
    • see their transfer balance cap
    • view their total super balance
    • view the status of any bring-forward arrangements relating to non-concessional contributions.
    • _

    Visibility of super information and additional account functionality will also be available to registered agents through the new Online services for agents.

    See also:

    From 1 July 2018, multiple systems merged into one, streamlining the process for members and funds improving the super fund member experience.

    The release authority legislation for excess contributions and Division 293 liabilities will be consistent and streamlined, including the:

    • payment timeframe
    • timeframe to return the release authority statement to us
    • destination for paying released amounts
    • requirement to notify individuals of successful releases.

    See also:

    Transfer balance cap

    Since December 2017, nearly all large Australian Prudential Regulation Authority (APRA) funds have lodged Transfer Balance Account Report (TBAR) for their 1.3 million members who are drawing an income stream. Consequently, we have started issuing a relatively small number of excess transfer balance cap determinations.

    TBARs provide a critical step in ensuring transparency for individual members and helping them manage their super.

    In May 2018, we wrote to every individual whose fund had advised us that they were receiving a capped defined-benefit income stream. We informed them that the tax rules had changed and they would likely need to include more of their pension income in their assessable income.

    To help people understand this change we are developing a calculator which tells individuals:

    • if they have a reduced defined-benefit income cap
    • what their defined-benefit income cap is
    • what they need to include in their return.

    A new label in the income tax return form will help individuals report this additional income.

    Super guarantee

    We are committed to improving the prevention and detection of non-payment of the super guarantee (SG).

    Prevention and protection of non-payment

    There has been great interest in the community, and on the public record, about the level of non-payment of SG. We are committed to improving the prevention and detection of SG non-payment.

    For 2015–16, we estimate the Superannuation Guarantee net gap to be $2.79 billion. This is equivalent to 4.8% of the total theoretical estimated SG amount employers were required to pay. This is the difference between the amount of SG we estimated should have been paid under the law and the actual SG contributions made.

    Within the current legal framework, we have focused on finding ways to improve our processes and casework to progressively improve the level of SG compliance.

    In June 2017, we formed the Employer Regulator Forum with representatives from the ATO, APRA, Australian Securities & Investments Commission (ASIC) and the Fair Work Ombudsman. This forum meets quarterly to work on employer obligations compliance activities, with a focus on SG and information exchange. The forum's aim is to protect employee entitlements.

    Since July 2017, we have moved from a six-monthly to a quarterly cycle of referrals to us from the Fair Work Ombudsman and we have now received over 350 referrals.

    We investigate and respond to all employee notifications in regards to non-payment of SG. Each year, the ATO receives approximately 30,000 reports from employees, former-employees and contractors who believe they have not been paid their SG entitlements.

    We are also more proactive in our compliance work. We have increased the proportion of ATO initiated case work undertaken to 40% of our total casework and will maintain this proportion for the coming year.

    In the 2017-18 financial year we:

    • completed 13,038 ATO-initiated cases – compared with 8,100 cases in 2016-17, an increase of 61%
    • raised $179 million from those cases – compared with $110 million in 2016-17, an increase of 63%
    • completed 31,954 compliance cases – compared with 19,547 cases in 2016-17, an increase of 63%
    • contacted over 21,000 employers as a result of reviews or audits
    • raised $850 million from all SG case-work, compared with $481 million in 2016–17.

    We've implemented the employer simulation and evaluation model which uses stratified sampling and is based on a ‘comparative nearest neighbour’ concept. This model compares characteristics for employers and identifies those with an increased likelihood of non-compliance. The model allows us to undertake a more targeted, timely and proactive approach to SG compliance.

    Following recent legislative changes aimed at protecting employees' superannuation entitlements, in April 2019 we introduced a new online Super guarantee employer obligations course designed to help employers understand their obligations to pay super to eligible employees. While the course is voluntary, it may be compulsory for employers that are not meeting their obligations.

    We collaborate with super funds about ways to improve the level of ‘fund referrals’ in instances where they see apparent non-payment of SG.

    In addition, we are increasingly using more real-time data that becomes available to us, including STP and more frequent fund reporting. This reporting helps employees keep track of their tax and super information in their ATO Online services accounts, accessed via their myGov accounts.

    A Superannuation Guarantee Taskforce is now in place and will operate for three years from 1 July 2018 to further extend our current compliance activities. This taskforce:

    • provides greater scrutiny of employers – based on data and analytics
    • focuses ATO-initiated audit activity on employers who have not met their SG obligations, with increased attention on debt collection.

    These actions – coupled with more real-time fund reporting, STP employer reporting and legislative changes to:

    • monitor and respond to concerns
    • disclose information to affected employees where there is a SG shortfall
    • identify and engage earlier with employers at risk of underpaying SG.

    See also:

    Reuniting taxpayers with lost super

    We want to reunite Australian taxpayers with their super, whether lost or unclaimed.

    Our Provision of details (POD) service allows funds to obtain updated member information we hold. From May 2018, this service can be used where their member's super is at risk of becoming lost or unclaimed. We have responded to approximately 1.1 million requests for updated member details.

    If a fund has reported their member as 'lost' via the Member account attribute service, we will return the information about updated member address and contact details to the fund.

    Through data sharing, members can be reunited with their lost super, stopping their funds from becoming unclaimed super money.

    The value of unclaimed super

    We remain focused on reuniting people with their ATO-held super. As at 2 July 2019, we held 5.07 million unclaimed super money accounts valued at $3.86 billion. We also held over 324,232 super holding accounts (SHA) worth $112.86 million.

    When a super fund loses contact with an individual, and their account has not received contributions for a number of years, that account is sent to the ATO as ‘unclaimed super’.

    From 1 July 2018 to 30 June 2019, over 537,000 accounts to the value of $4.38 billion have been consolidated or transferred by fund members using the ATO online services.

    Communication about lost super

    In October 2018, we released our media campaign on annual lost and unclaimed super to encourage those who may be disconnected to claim their super. We released the top five postcodes for each state and territory with the biggest variance on the previous year.

    More than 66,000 people found and consolidated over 105,000 accounts worth more than $860 million from October to December 2018 using ATO online accessed via myGov.

    In April 2019, we contacted 78,000 people via email to let them know they had unclaimed ATO-held super. Within 8 weeks of the notification around 10,500 individuals claimed over $14 million in ATO-held super.

    Lost super still out there

    ATO Online, via myGov, lists all super accounts held by an individual and lets them consolidate their accounts in one click.

    Last modified: 19 Nov 2019QC 57217