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  • Super Measures Group (SMG) key messages July 2018

    Welcome

    Presented by Jason Lucchese

    Key messages

    • The group were reminded about the Terms of Reference this group will operate under, including what this group will consult on, as well as confidentiality and conflicts of interest.
    • Meetings will be scheduled monthly however from time to time where we see it’s important we will come together to work through design or other considerations in relation to the measures.
    • The key messages can be shared within your organisations and associations.

    Notice of intent (NOI)

    Presented by Anthony Clarke

    Key messages

    • In 2018 budget the government announced the Superannuation better integrity over deductions for personal contributions measure. This measure is about improving the integrity of the notice of intent process for claiming deductions for personal superannuation contributions.
    • There is no law change for this measure.
    • The project is currently in high level design phase.
    • We are seeking feedback on possible form changes to include a NOI question, similar to the 2018 individual tax return, that may trigger their member to complete a notice before undertaking other transactions such as a rollover or contributions splitting.
    • Feedback from the group indicated some funds already include a NOI form with the other super forms.
    • We will use NOI acknowledgement data and contributions data reported via MATS to verify deductions claimed in the 2019 individual tax return.
    • We would like funds to report their NOI data via MATS
    • Members suggested that we need to consider situations where MAAS and MATS data is unmatched in our tax return exceptions process as well as First Home Super Saver Scheme re-contributions.
    • There was support from the group to be involved in the consultation around NOI.

    Protecting your super package

    Presented by Louie Markovski

    Key messages

    • Protecting your super package was part of the 2018 Federal Budget aimed at protecting low balance accounts from unnecessary fee erosion and insurance costs as well as reducing low balance accounts by driving account consolidation.
    • The measure will require super providers pay a members account to the ATO where the account has been inactive for 13 months and the balance of the account is less than $6000 unless the member has chosen to opt in for insurance on that account – report by 31 October 2019.
    • Subject to passage of law the Commissioner will have new powers to proactively consolidate.
    • We expect $6 billion of individual’s superannuation to be reunited with 3 million active accounts.
    • There is a strong expectation that we will pay out the low balance accounts within one month of receiving the low balance accounts along with any existing unclaimed super money (USM) accounts held by the ATO. We expect to commence consolidation in November 2019. The first year will be the biggest.
    • Through the consultation we’d like to focus on the part of the measure that the ATO has coverage of.
    • Industry noted that it’s not just about reporting to the ATO, it’s about the registry system changes as well, with rollovers version 3 coming out in November 2019, which is later than the 31 October 2019 reporting and payment obligation of ‘inactive low balance accounts’. So still left without a mechanism or channel to send the new category of UMS being ‘inactive low balance accounts’ to the ATO.
    • USM is currently reported and paid through SuperStream- data and payment standard.
    • We will explore within current standard the opportunity to accept ‘inactive low balance account’ as another category of USM.
    • It is acknowledged that some funds have elected to build their USM messaging to the ATO on a one to one basis, meaning they send one message and one payment for each account. Others report and pay in batches.
    • Having identified ’inactive low balance account’ on the unclaimed monies day (31 December or 30 June) but then by the scheduled statement day (30 April or 31 October) funds no longer have an amount payable to the ATO, requires some further consideration under the current SuperStream standard. This is something we will work through with this group.
    • When reporting and paying USM to the ATO funds will advise a member that they have closed their account by sending an ‘exit letter’ to account holder.. The communication is increasingly becoming digital.
    • Implementing changes into MIG V3 will challenge funds ability to deliver on the ‘inactive low balance account’ measure.

    Action item

    Louie Markovski to check the law to see if there is a legal requirement for ‘inactive low balance accounts’ to be recorded separately.

    SMSF rollovers

    Presented by Tracie Crowden

    Key messages

    • The government has endorsed the policy to extend SuperStream legislation to include self-managed superannuation fund (SMSF) rollovers.
    • There was a discussion about the scope and unpacking all the candidates to see the effort and benefits against each of the candidates to inform the scope.
    • Industry recognise that (SMSF Verification Service(SVS) is a big component – we need to validate that the member is a member of an SMSF.
    • Industry recognised the release authority is in pattern with the rollover message and that it made sense to include them.
    • It was recognised that we need the right coverage of SMSF market when doing co-design.
    • It was clarified that this measure includes SMSF rollover in and out of an SMSF.

    Other Business

    Presented by Jason Lucchese

    Key messages

    • 7 August was suggested for a face to face session in Sydney. The day being spend on SMSF rollovers and the protecting my super package. This will be confirmed shortly.

    Attendees

    Anthony Clarke, ATO

    Belinda Black, ATO

    Blair Lauchlan, ATO

    Chris Denney, SuperChoice

    David Delaney, ANZ

    David Kerr, NAB

    Deb Goldfinch, ATO

    Erica Hobson, Mercer

    Gavin Hayhurst, ATO

    Hans van Daatselaar, ASP

    Heide Stewart, IOOF

    Jason Lucchese, ATO

    Jimmy Sun, BT

    Joanne Ng, BGL

    Kelly Kerr, AMP

    Kylie Smith, ATO

    Linda Cheeseman, ATO

    Louie Markovski, ATO

    Lyn Formica, Heffron

    Matthew Lane, QSuper

    Max Phillis, Treasury

    Mel Birks, Link

    Narelle Telfer, Mercer

    Paul Li, Class

    Peter Burgess, SuperConcepts

    Richard Webb, AIST

    Sarah O’Brien, GNGB

    Spiros Koziaris, ASP

    Sue Pearce, Link

    Tim Pulsford, ATO

    Tracie Crowden, ATO

    Apologies

    David Haynes, AIST

    Martin Mikulicin, BT

    Meg Heffron, Heffron

      Last modified: 10 Oct 2018QC 56982