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  • SASG minutes 21 November 2018

    Note: SASG agendas, minutes and related papers are not binding on the ATO or any of the other bodies referred to in these papers. While every effort is made to accurately record views expressed, the wording necessarily represents a summary of statements of general position only, and care should be taken in interpreting those statements. These papers reflect the position at the date of release (unless otherwise noted) and readers should note that the position on any issue may subsequently change.

    Agenda items

    1. Welcome

    Director, Client Relationships, Intermediaries & Assurance, Shaun Ferabend opened the meeting:

    • Welcomed all in attendance.
    • Acknowledgment of the traditional owners and custodians of the land.

    2. Action items from September 2018 SASG

    New Chair for next year – Presented by Shaun Ferabend

    SASG was provided with an update on the action items from the September 2018 SASG.

    They were also advised there will be a new chair for next year Mr Jason Lucchese Assistant Commissioner, SuperStream Delivery. On behalf of Robert and Shaun we wish to thank all stakeholders in attending these meetings: providing assistance and candour to the ATO in helping build a robust and better Super system for all Australians. We know this will continue to be a great collaborative and consultative forum.

    3. First Home Superannuation Saver Scheme; Compassionate Release of Superannuation; Downsizing Measures – Presented by Reece Parry

    Background

    The purpose of this submission is to provide an update for the First Home Super Saver (FHSS) scheme, the Compassionate Release of Superannuation (CRS) programme and the Downsizer Housing measure which were implemented by the ATO on 1 July 2018.

    First Home Superannuation Savers Scheme

    Since the last meeting, a FHSS guidance note and fact sheet have been published. Links to the documents are scheduled to be added to our web content by 20 November 2018 on ato.gov.au (search QC 54085 and scroll to the ‘More information’ heading at the bottom of the page). Funds will be able to print and download these documents from the website.

    During the first four months of the scheme’s operation and through our engagement with individuals and funds, we have identified some handy tips to help ensure a smooth process for members and funds.

    Handy tips/information

    Using correct PRN

    It is important for funds to use the correct Payment Reference Number (PRN) on the FHSS Release Authority for each member/payment when sending money to the ATO. This will avoid unnecessary delays for the member receiving their FHSS money.

    Client ID matching

    If a fund is unable to/having difficulty matching a member’s details with those on the member’s FHSS RAS, funds can follow-up with their member or check details with us via Super CRT. We will verify details where we are able to, in accordance with the Privacy Act. To reduce the chance that an individual’s details are mismatched, we have updated our web content to advise applicants to check that their details held by their fund match those held by the ATO prior to applying for a release.

    Completing and returning RAS

    We remind funds that the FHSS release authority statement (RAS) form (NAT 74981) needs to be completed for every release authority, regardless of whether funds are able to release any money under FHSS. This is a legal requirement.

    The RAS form includes options for funds to complete where:

    • The member does not have sufficient funds available or no longer has any super interests within the fund
    • The member has funds available, though cannot be released due to the interest being a defined benefit interest or non-commutable income stream

    If money cannot be released from your fund, provided the member has agreed, we will request the release of FHSS funds from any other super account the member holds.

    Source of release amount

    Funds are not required to match the contributions or associated earnings used to calculate the FHSS release amount to a specific account i.e. the FHSS amount does not need to be released from the account/fund where the personal voluntary contributions were made. Members can request the release to be made from any of their superannuation accounts, even if no personal voluntary contributions were made to that account.

    Foreign fund transfers (including KiwiSaver)

    We can confirm that foreign fund transfers:

    • apart from a few exclusions, can be counted as part of the calculation of the FHSS maximum release amount, and
    • can be released by funds in response to a FHSS release authority, subject to the normal cashing of benefit rules.

    The FHSS web content and guidance note have been updated to confirm this information. A CRT alert will issue by 20 November 2018 to advise funds.

    Early Release of Superannuation on Compassionate Grounds (CRS)

    The CRS programme has been operating in the ATO for four months now and through our interactions with funds, we have identified a number of hints and tips that will contribute to a better fund and member experience.

    Handy tips

    BDE notices

    A reminder that the CRS BDE notices are not a release authority and funds are not required to make payments based on this notice. The previous arrangements where funds wait until the client presents their approval letter to the fund before making a payment, remain unchanged.

    Based on the previous feedback from funds/administrators, advising that with multiple funds to administer, it is a manual process to extract the BDE notices from the portal to forward to the correct fund, we have submitted a request to update the BDE file name to include the fund ABN or USI so funds won’t need to open each file. We will advise funds once we are able to confirm when this change can be implemented.

    A reminder that when lodging an MCS or related forms, that selecting ’paper’ as the preferred channel will prevent the BDE notification being sent to the fund.

    Tax Treatment of Releases

    The notification provided to both the individual and the fund contains the approved net amount for release. Tax, fees and other charges are to be deducted from the member’s account in addition to the approved release amount. During our review of letters/notices will update the wording to make this clearer.

    Web Content

    Following some feedback from funds regarding members requesting access to money under temporary incapacity and referencing content on ato.gov.au, we have made updates to the web content to clarify this issue and to reduce questions to funds.

    Applications under Severe Financial Hardship

    A reminder that the transfer of the compassionate release of super function to the ATO from DHS, did not include the transfer of release of super under severe financial hardship. DHS continue to produce the confirmation letters or funds can use the DHS electronic confirmation service. We have received feedback from some clients that they have been advised by their fund to contact the ATO regarding release under severe financial hardship, these queries should be directed to DHS.

    Transition of CRS from DHS

    DHS finalised all outstanding CRS applications at the end of August 2018. Following the completion of the normal review period, DHS concluded all CRS activities on 12 September 2018. A CRT alert (070/2018) was sent on 24 September 2018 advising that funds should not receive any approval letters from DHS dated after 12 September 2018. For any DHS approvals after this date, funds should contact Super CRT and we will investigate its validity.

    Duplicates – In addition, please continue to contact Super CRT if you receive an approval to release which is a duplicate for the same person and value. We have put processes in place to minimise duplicate ATO applications.

    Temporary Residents

    The ATO relies on the client to declare if they are an Australian Citizen/Permanent Resident during the CRS application process. If super funds receive a request for release from a client that they have identified as being a temporary resident, please contact Super CRT prior to making payment.

    Downsizer Housing Measure

    On 1 July 2018, the downsizer housing measure commenced. Individuals aged 65 years or older, who sell their main residence that they have owned for at least 10 years, can contribute up to a maximum of $300,000 into superannuation as a downsizer contribution. Both members of a couple can take advantage of this measure, even if only one of them is on the title. Individuals can only access this scheme once, from the sale of one home.

    For superannuation funds this means that contributions can be accepted now, and you may use the ATO On-line Portal reporting option pending your on-boarding to the Member Account Transaction Service (MATS). However, if you use the Portal prior to on-boarding to MATS, you may need to check with your software provider that duplicated reporting of contributions won’t occur. If so, you will need to consider holding off reporting those contributions.

    To ensure the contribution can be matched – you should update your member’s date of birth, address or contact details and ensure you have lodged the members MAAS before reporting the Downsizer contribution.

    As at 31 October 2018, 83 downsizer contributions have been reported to the ATO, via the MATS (10) and ATO On-line Portal (73) options. Contributions have surpassed $20.3 million, with an average of $241,000 each and range from those aged 65 to 92 years of age.

    Action item response

    Industry have requested clarification on the issue of a previously noted 13 month turnaround timeframe for Downsizer validation/reporting.

    To date:

    • Downsizer contributions are successfully being reported to the ATO.
    • There are no ineligible Downsizer contributions thus far.
    • It is anticipated the number of ineligible Downsizer contributions (if any) will be low.

    To provide further clarity to Industry in regards to the timeframes for downsizer validation/reporting we advise that where:

    • the amount is incorrect – the fund will be advised within a week.
    • the member’s age is less than 65 – we will contact the member to give them a chance to provide further information; which means it may be up to three (3) months before we are able to provide definitive advice to funds.
    • the property sale requires confirmation - we will use information from the State Lands Titles Offices which is provided quarterly. It may take up to three (3) to four (4) months before we can contact the member to give them a chance to provide further information; which means it may be an additional (3) months before we are able to provide definitive advice back to funds.

    In relation to the treatment of ineligible Downsizer contributions, we are still working through our approach for these contributions. Until the approach is finalised, if we identify any ineligible Downsizer contributions, we will contact the relevant fund and work directly with them. Once our position in relation to the treatment of ineligible Downsizer contributions is finalised, we will communicate this to Industry as a matter of priority.

    4. Combined Caps Implementation Update – Presented by Jenny Lin

    New measures arising from the 16-17 Budget and the changes to caps are now in the process of implementing key deployment milestones.

    This agenda item will provide an understanding of how the scheduled system upgrades on

    1 October 2018 are progressing and; how deployment will continue to impact funds, tax professionals and members.

    Updates include:

    • The October system upgrades for Total Superannuation Balance (TSB) were deployed resulting in the successful recalculation and display of Total Super Balance for (amount) individuals that were showing duplicate balances.
    • Throughout the deployment of the upgrades; we detected an additional 2 x key defects for mitigation:

    Changes and duplicate accounts associated with Total Superannuation Balance

    • Defect 1: Multiple reported accounts for an individual under the one fund with only a single account being consumed.
      This defect has an expected resolution date of 22 November 2018
    • Defect 2: Retirement phase interest entered into in the 2017-18 financial year was not included as part of an individual’s 30 June 18 TSB.
      This defect has an expected resolution date of 22 November 2018
    • Outcome: By 26 November 2018 impacted individuals are expected to be able to see their updated TSB including all accounts correctly displayed..

    Determinations for Concessional Contributions & Non-Concessional Contributions for 2017-18FY

    • Determinations for the 2017-18 financial year will start to issue from late November 2018 (previously planned for mid-late October 2018)
      This updated date is a result of the discovery and mitigation of system defects throughout deployment, subsequently resulting in a minor delay.
      Delays should have minimal to no impact on industry, however; funds should be prepared for an increase in engagement and queries from members who are receiving Excess concessional contributions (ECC) and Excess Non-Concessional (ENCC) determinations in late November.

    Release Authority / Release Authority Statements

    • A reminder that from November 2018, as determinations are issued - a single release authority / release authority statement product will be deployed for Concessional, Non-Concessional and Div293.
    • Super funds will have a consistent destination to release amounts, being the ATO and a consistent timeframe to action release authorities.

    5. MAAS/MATS Onboarding Update – Presented by Tracie Crowden

    Extending SuperStream rollovers to SMSF

    Background

    In April 2018, Minister O’Dwyer announced that SuperStream will be expanded to include Self-managed super fund (SMSF) rollovers.

    The changes implemented by this project will allow SMSF members to initiate and receive rollovers electronically between an APRA fund and their SMSF.

    The inclusion of SuperStream rollovers to SMSF’s will commence from 30 November 2019.

    This policy required Law change to remove the exclusion of Self-Managed Super Fund (SMSF) rollovers.

    It is essentially a re-versioning of the current rollover message (version 2) currently used for rollovers and transfers between APRA funds and or the ATO.

    Although a re-versioning exercise for the ATO and APRA funds, this is a complete and a complete new build for SMSFs.

    Design overview

    The design will not only require an upgraded rollover message but the development and implementation of an SMSF Verification Service (SVS). This will be a similar service to the current Fund Validation Service (FVS) and support the rollover process by verifying SMSF information with that held by the ATO.

    In partnership with a cross section of industry including both APRA and SMSF representatives, the high level design for this non–discretionary change has been worked through.

    5.1 MAAS and MATS reporting via the Business Portal – Presented by Tracie Crowden

    Background

    Many providers are transitioning or have commenced event-based reporting via the SuperStream services – Member Account Attribute Service (MAAS) and Member Account Transaction Service (MATS).

    In some circumstances it is not feasible for providers to report MAAS and MATS via SuperStream which may include where:

    • Providers (or certain products) are not SuperStream enabled – generally those with very low volume transactions where the build investment in SuperStream would not be reasonable. For example, those with some smaller registry systems.
    • Providers require an interim solution, such as, where due to timing issues they are unable to transition to SuperStream until later, or to test a new policy reform.

    MAAS and MATS reporting will made available via the ATO Business Portal to enable these providers to meet their legislated obligations. However this channel cannot provide the same benefits or automation compared to investment in the SuperStream MAAS and MATS assets.

    Design overview

    A Business Portal solution, designed in consultation with a cross section of industry representatives, is scheduled for release by early April 2019. It will incorporate and replace the Contributing the proceeds of downsizing into superannuation (Downsizer) reporting form, available via the Business Portal in October 2018.

    This Business Portal solution will allow providers to report MAAS and MATS by manual data entry on a single transaction basis (at the member level, one transaction at a time). It will also give visibility of some information at the member level, that a provider has reported to the ATO.

    As the delivery timeframe of the Business Portal solution for MAAS and MATS is in early 2019, a minimum viable product with restricted functionality is being made available in December 2018 for providers who require an interim solution.

    Providers intending to report MAAS and MATS via the Business Portal are required to contact the ATO to discuss their transition date, and request a deferral of the relevant reporting obligations.

    5.2 MAAS/MATS Onboarding/Implementation Update – Presented by Tracie Crowden

    To provide a progress update on the status of MAAS/MATS implementation including

    • A presentation will be provided on the day to SASG members to advise on:
    • Progress status of fund onboarding and implementation of MAAS/MATS including % of funds and members covered by deferrals or potential users of the MAAS/MATS Online Portal.
    • As at 31 October we had 217 entities that had completed their onboarding onto MAAS (covering 99% of members); and 5 entities of 5.3% of members covered by the funds that had onboarded onto MATS.
    • Volume of MATS transactions received to date. There are approx 2.2 million MATS transactions that have been received to date, which is relative to the number of entities that are in operation and have completed their onboarding onto MATS.
    • Update on post MAAS onboarding data reconciliation activities and
    • Current advice for MATS onboarding and system changes eg support for 100k batch files and revised polling advice.

    Background

    MAAS – The Member Account Attribute Service (MAAS) is a service for superannuation providers to report changes to a member's account attributes when they occur.

    MAAS will:

    • replace the existing Lost Member Statement to be the new mechanism for reporting lost members to the ATO. The obligation for reporting lost members remains twice a year, but providers may choose to report more regularly
    • incorporate an optional build component for a provision of details (POD) service to allow trustees to request ATO-held contact details on-demand (for example, before a member becomes lost)
    • Funds commenced onboarding onto MAAS between April and October 2018. The update today will provide industry with an update on the status of onboarding.

    MATS – The Member Account Transaction Service (MATS) is a new reporting solution that allows for more frequent, event-based reporting of member data to the ATO.

    MATS, together with the Member Account Attribute Service (MAAS), will replace the member contributions statement (MCS). This will shift traditional reporting of annual aggregated amounts via the MCS to transactional-level data reported during the year through the MATS.

    • MATS was deployed into production in early July 2018, with an expectation that trustees will start reporting through MATS as they cutover their systems and complete back reporting between July 2018 and March 2018.
    • Due to the significance of the change, there will be a longer-than-normal cutover period till 31 March 2019.

    6. APRA Fund Communications Reference Group - Presented by Kylie Smith

    APRA fund communications: Check-in and Help us shape future improvements

    Purpose/Action

    1. Recap changes made to the ATO’s broadcast (one-way communication) and static channels and get feedback on whether they are working as intended
    2. Check-in on the current state of irritants for discussion at future meetings
    3. Seek agreement to give feedback on the ATO’s communication channels (what is working well and what can be improved) as part of web review

    Background

    The APRA Fund Communications Reference Group ran from December 2017 to August 2018 and acted as a ‘sounding board’ for the ATO and super industry to:

    • Identify, consider and co-design strategies to address irritants and improve the communications, engagement and collaboration between the superannuation industry and the ATO.
    • Validate current communication, engagement and collaboration strategies to confirm their value and assess whether they should become, or continue to be, part of our “day to day” way of operating.
    • Prioritise identified changes and opportunities into:
      • Grass roots – “quick win” low touch improvements
      • Tactical – medium term low touch improvements (may require small change IT change)
      • Transformation – strategic/aspirational improvements (may require investment from ATO and industry).

    The key outcomes from this special purpose Group were:

    • Delivery of a range of initiatives and identification of longer-term initiatives that are in train
    • Learnings and insights gained from these industry conversations which we are working to embed as part of our “day to day” way of operating (see Attachment A for detail).

    The Group was comprised of 18 representatives from 11 entities, and was sponsored by the SASG.

    At the last meeting of the SASG:

    • It was noted that there was value in continuing to discuss communications and engagement irritants and improvement opportunities
    • It was agreed that at each quarterly SASG, time would be set aside to continue these conversations by working through a rolling cycle of topics that were considered by the Reference Group. Insights from these conversations will be relayed to Reference Group members.

    The first topic considered by the Reference Group was the ATO’s broadcast (one-way communication) channels. The key outcomes from that discussion were:

    • Agreed the Super Communique and SuperUpdate newsletters would be combined, and structured along the lines of the Super Communique
      • Super News was preferred name for new combined newsletter, and it would begin issuing in March 2018
    • Agreed to progressive publishing of articles to ato.gov.au with a summary of news items issued during the month included in Super News
    • ATO will explore enhancements to the Announcements section of the Dashboard, such as covering system issues for other services such as DASP.

    The second topic considered by the Reference Group was the ATO’s static channels (which provide resource information and communication materials). The key outcomes from that discussion were:

    • The Group’s key observation was that super content on ato.gov is very good but can be challenging to find
    • The Group supported the following changes to ato.gov:
      • Summary of ATO digital channels will be added to APRA funds section
      • What’s New section should be displayed more prominently and promoted.
    • Members commented on the high quality of the First Home Super Saver Scheme communications and the usefulness of Alex
    • ASP offered to pilot a closed group community within ATO Community.

    Changes made to the ATO’s broadcast (one-way communication) channels

    Questions for feedback:

    Is the progressive publishing of articles in the (new) Super News format and CRT Alerts working together? Ie. is it clear what to expect from each channel?

    Any concerns about these primary broadcast channels?

    Seeking feedback on the ATO’s communication channels

    One of the outstanding actions items from the APRA Fund Communications Reference Group is to beta-test some enhancements and structural changes to the APRA funds section of ato.gov.au. The first phase involves undertaking a needs analysis of the APRA fund community, focussed on looking at the current channels and in particular if they’re the right mix.

    A short survey (attached below) has been developed by the ATO Beta (research and design) team to understand:

    • Who is the audience and what their roles are
    • What their current interactions are, what is working well and what can be improved.

    Your survey feedback will be anonymous. We are also seeking your support to:

    • Forward the survey to a mix of staff in your organisation and encourage them to complete the survey as it will provide us with invaluable feedback to help identify areas requiring improvement
    • Participate in more detailed contextual interviews to identify user perception and current experience with ATO products and services, including usability of the ATO website and satisfaction with communications channels. To participate in the contextual interviews, emailing SuperConsultation@ato.gov.au to express your interest and have your say.

    7. SASG – What works or does not work, how could we improve these meetings going forward – Presented by Shaun Ferabend

    Shaun deferred to the group who advised it was working for them as is. Shaun also advised it the members had any other questions or suggestions to forward these the the SASG Secretariat mailbox.

    Meeting closed 1:30 pm.

    Meeting details

    Venue:

    ATO Office , 52 Goulburn Street, Sydney

    Date:  

    Wednesday 21 November 2018

    Start:  

    10:00am

    Finish:  

    1:30pm

    Chair:  

    Shaun Ferabend

    Secretariat:  

    Shaun Ferabend

    Contact phone:  

    07 3121 7466

    Attendees

    Industry

    Name

    Organisation

    Fiona Galbraith

    AFSA

    Kelly Kerr

    AMP

    Tina Cifelli

    AMP

    David Delaney

    ANZ

    Jun Tang

    ANZ

    Sam Finucan

    Bravura Solutions

    Jimmy Sun

    BT Financial

    Martin Mikulicin

    BT Financial

    Adam Wright

    CBA

    Daniela Palermo

    CBA

    Ari Gerasimou

    CBA

    May Low

    Colonial First State

    Brett McLeod

    Colonial First State

    Gareth McAlister

    CSC

    Heide Stewart

    IOOF

    Chloe Continenza

    IOOF

    Andrea Cooper

    IRESS

    Sue Pearce

    Link Group

    John Hardas

    Link Group

    Narelle Telfer

    Mercer

    Anthony Relf

    Mercer

    Louise Hemar

    Mercer

    David Kerr

    NAB

    Ian Roberts

    NAB

    Ian Gray

    NAB

    Timothy Coulter

    Onevue

    Marcia Pitstock

    OneVue

    Meegan Punch

    Onevue

    Kathy Calman

    Perpetual

    Rebecca Scott

    Perpetual

    Catherine Best

    QSuper

    Jayne Pocock

    QSuper

    Dean O’Malley

    SA Super

    Matthew Pritchard

    Sunsuper

    Mary Gale

    Syncsoft

    George Strilakos

    UniSuper

    Warren Liang

    UniSuper

    Maria Ainslag

    Zurich

    ATO Attendees

    Name

    Role

    Jenny Lin

    Assistant Commissioner, SPR TECH LEADERSHIP AND ADVICE

    Shaun Ferabend

    Director, Client Relationships, Intermediaries & Assurance

    Catherine Johnston

    Director, Governance and Initiatives

    Kylie Smith

    Director, APRA Fund Client Experience, Client Engagement

    Frances Sainsbury

    Director, Application Architecture & Design

    Tracie Crowden

    Director, SPR SS REPORTING TO GVRMNT DESIGN

    Annette Thurbon

    Director, SPR SS Readiness and Implementation

    Reece Parry

    Director, SPR Employer and Individual Client Engagement

    Rosette Singh

    Director, SPR APRA Fund Engagement

    Rebecca Brown

    Client Account Services, Client Relationship Team, SASG Administration

    Apologies

    Name

    Organisation

    Amanda Gunn

    Mercer

    Dianne Sherry

    IRESS

      Last modified: 02 Apr 2019QC 58464