Preview
Archived Posts Lists

Australian Regulatory Compliance Review
Australian Technology and IP Business
Credit Union and Mutual Law
National Consumer Credit Reform
Personal Property Securities Australia
Longview Business Insights
Australian Private Health Insurers
Wills, Trusts, Super
Mutuals Resource Centre

Resources

Commonwealth legislation
Corporate Governance
Not-for-Profit links
Regulator Links

November 1, 2012

Award default superannuation funds

The Fair Work Amendment Bill has been introduced in to the House of Representatives.

Amongst other things the Bill will, if passed:

  • introduce new requirements in relation to modern award terms about default superannuation, and a process under which the Fair Work Commission will review default fund terms every 4 years, at the same
    time as the 4 yearly review of modern awards (the first such review must be conducted as soon as practicable after 1 January 2014), and
  • provide for the establishment of the Expert Panel to assess default superannuation funds.

A Full Bench of the Fair Work Commission will then determine which particular funds from the Default Superannuation List are best suited for inclusion in each modern award.

UPDATE 1 November: The Bill has been passed by the House of Representatives.

Apart from the default super fund changes the Bill also covers changes to the unfair dismissal provisions discussed here.

UPDATE 2 November: The Senate Education, Employment and Workplace Relations Legislation Committee has a new inquiry into the Bill.

Print This Post Print This Post

Posted 1st November 2012 by David Jacobson in Superannuation, Workplace

October 23, 2012

First Home Saver Accounts Act changes

First Home Saver Account (FHSA) deposit accounts are an account issued by an authorised deposit-taking institution (ADI), such as a bank, building society or credit union as well as lerfe companies and RSE Licensees. The features of FHSA deposit accounts are similar to basic deposit products but have restrictions on withdrawal and particular consequences when the accounts are closed because of the tax treatment.More .

The exposure draft Superannuation Legislation Amendment (Further Measures) Bill 2012 contains amendments to the First Home Saver Accounts Act 2008.

If passed, the Bill will replace the existing capital requirements for applicants seeking authorisation as an FHSA provider with a requirement that an applicant satisfy the financial requirements set out in prudential standards under the FHSA Act. The existing capital requirements employ capital requirements for the trustees of public offer superannuation funds which have been repealed by the Trustee Obligations and Prudential Standards Act.

The FHSA Act will also be amended to apply the provisions of the SIS Act to persons involved in the management of an FHSA provider in the same way that the SIS Act provisions apply to a responsible officer of an RSE licensee that is a trustee of a public offer superannuation fund.

Print This Post Print This Post

Posted 23rd October 2012 by David Jacobson in Financial Services, Insurance, Superannuation

October 22, 2012

Super changes in Mid-Year Economic and Fiscal Outlook

The Mid-Year Economic and Fiscal Outlook contains changes relating to superannuation accounts.

Changes to lost super accounts
The Government will introduce the following reforms:
•The account balance threshold below which inactive accounts, and accounts of uncontactable members, are required to be transferred to the ATO will be increased from $200 to $2,000;
•Interest will be paid at a rate equivalent to Consumer Price Index (CPI) inflation from 1 July 2013 on all lost superannuation accounts reclaimed from the ATO; and
•The period of inactivity before an account of an unidentifiable member is required to be transferred to the ATO will be reduced from five years to 12 months.

The reforms to the transfer of lost accounts to the ATO will take effect from 31 December 2012. The ATO will use its data matching resources to match these lost accounts with members.

Deceased estates
The Government will amend the law to allow the pension earnings tax exemption to continue following the death of a pension recipient until the deceased member's benefits have been paid out of the fund.

This will benefit the beneficiaries of deceased estates by allowing superannuation fund trustees to dispose of pension assets on a tax-free basis to fund the payment of death benefits. It will also avoid the need for funds to rework tax calculations following the death of members in the pension phase.

These changes will apply to the 2012‑13 and later income years.

Super fund mergers
The Government will ensure that superannuation fund members are not disadvantaged where their benefits are rolled over within a fund or between funds. Currently, the superannuation tax laws provide for a ‘proportioning rule’, which is an integrity rule designed to remove individual members’ capacity to reduce their tax liability by manipulating the ‘taxable’ and ‘tax-free’ components of their superannuation benefits.

As an integrity rule addressing the behaviour of individual members, the proportioning rule was intended to apply only to transactions that are within the control of the individual members. The Government will introduce legislation, to apply from 1 July 2013, to clarify that this integrity rule does not apply to transactions that are beyond the control of individual members.

The Government will give merging superannuation funds greater flexibility by making the following changes to the taxation relief to support Stronger Super:
• backdating the taxation relief for mergers to apply from 1 October 2011;
• extending the relief to all revenue assets regardless of the net position of the entity;
• removing the 12-month rule which prevents certain losses from being transferred;
and
• ensuring that members transferred under MySuper retain the right to claim a personal tax deduction in the new fund.

Print This Post Print This Post

Posted 22nd October 2012 by David Jacobson in Financial Services, Superannuation, Tax, Uncategorized

Superannuation Further Measures Bill: tranche 4

The exposure draft of the Superannuation Legislation Amendment (Further Measures) Bill 2012 contains the fourth tranche of legislation for the Government’s Stronger Super (MySuper and governance) reforms.

The majority of the provisions take effect from 1 July 2013.

The Bill's provisions include: trustees providing reasons for their decisions; an increase in the time limit for members to lodge complaints with the Superannuation Complaints Tribunal; restricting voting prohibitions; seeking leave from the Court before bringing action against an individual director for a breach of their duties.

Reasons for trustees' decisions
Trustees will be required to provide reasons for decisions in relation to death benefit complaints.

In relation to other complaints, trustees will be required to provide reasons for decisions when requested.

Time limit to lodge complaints
The time limit for members to lodge a complaint with the Superannuation Complaints Tribunal in respect of TPD claims will be increased to six years after the decision.

Where a person has permanently ceased employment, and lodged a claim within two years of ceasing employment, they will have four years from the decision to make a complaint.

Actions against directors
Before being able to bring an action against an individual director for a breach of a director duty or MySuper obligation, a member must be granted leave by the Court. In making its decision, the Court will take into account whether the member is acting in good faith and that there is a serious question to be tried.

Trustees and directors have a defence to a contravention of a duty or MySuper obligation if the contravention was due to reasonable mistake or due to the fault of another and they acted with reasonable precaution and applied due diligence.

Voting by a director or trustee
Provisions in a corporate trustee’s governing rules that prohibit a director or individual trustee from voting on a matter relating to the superannuation fund (except where a conflict of interest or duty exists) will be made ineffective.

Print This Post Print This Post

Posted 22nd October 2012 by David Jacobson in Financial Services, Superannuation

October 18, 2012

Fair Work changes

The Government has announced it will implement a first tranche of recommendations arising from the independent Fair Work Act Review.

The proposed amendments include recommendations covering unfair dismissal and enterprise bargaining and agreement making.

The time limit for lodging unfair dismissal applications will be extended to 21 days.

The Fair Work Act will also be amended to allow Fair Work Australia to make costs orders against a party that has unreasonably failed to discontinue a proceeding, or that has unreasonably failed to agree to terms of settlement that could have lead to discontinuing the application, or that has through an unreasonable act or omission caused the other party to incur costs.

The Government also intends to include changes to the Fair Work Act to implement a number of recommendations arising from the Productivity Commission’s final report into default superannuation funds in modern awards.

Print This Post Print This Post

Posted 18th October 2012 by David Jacobson in Superannuation, Workplace

October 15, 2012

MySuper transition

The Australian Prudential Regulation Authority (APRA) has released for public consultation its draft guidance SPG 410 MySuper Transition.

The guidance is intended to assist registerable superannuation entity (RSE) licensees to meet their obligations under Prudential Standard SPS 410 MySuper Transition which was released as a final draft on 3 October 2012. SPS 410 sets out requirements for the movement of accrued default amounts into a suitable MySuper product before 1 July 2017.

The guide is expected to be finalised by December 2012.

APRA has updated its MySuper FAQs.

Print This Post Print This Post

Posted 15th October 2012 by David Jacobson in Financial Services, Superannuation

October 10, 2012

Registration of SMSF auditors

From 1 July 2013, to be engaged by the trustee of an SMSF to audit their fund and sign the Independent Audit Reports an auditor must be registered with ASIC as an approved SMSF auditor.

SMSF trustees will be required to provide the SMSF Auditor Number of their appointed auditor when lodging their SMSF annual statement.

ASIC has announced details of their SMSF auditor register here

Background

UPDATE 15 October 2012:
Treasury has released for public consultation an exposure draft of regulationsrelating to the self managed superannuation fund (SMSF) auditor registration regime and the prescribed period for the provision of an audit report as well as explanatory material.

Print This Post Print This Post

Posted 10th October 2012 by David Jacobson in Superannuation

October 5, 2012

APRA releases MySuper requirements

The Australian Prudential Regulation Authority (APRA) has released its proposed final application form and instructions for the authorisation of MySuper products and proposed final Prudential Standard SPS 410 MySuper Transition.

The proposed final Prudential Standard sets out requirements for the movement of accrued default amounts into a suitable MySuper product before 1 July 2017.

The authorisation process for registerable superannuation entities (RSE) licensees wishing to offer MySuper products is expected to commence from 1 January 2013. Once authorised, RSE licensees can offer these products from 1 July 2013 onwards.

APRA has also released the proposed final application form and instructions for authorisation to offer an eligible rollover fund (ERF). The authorisation process for RSE licensees to offer an eligible rollover fund is expected to commence from 1 January 2013.

Print This Post Print This Post

Posted 5th October 2012 by David Jacobson in Superannuation

September 28, 2012

Austrac and Departing Australia Superannuation Payment

Austrac has published draft amendments to Chapter 41 of the AML/CTF Rules relating to the cashing out of low balance superannuation accounts for consultation.

The draft amendments extend the relief in the chapter to include the Departing Australia Superannuation Payment (DASP). Under DASP, temporary residents who leave Australia are entitled to cash out their superannuation benefits once they leave Australia. The draft amendments exempt reporting entities from undertaking customer identification on such persons, subject to certain conditions including:

  • the value of the interest is not greater than $5,000; and
  • no additional contributions are accepted from the member in relation to the member’s interest in the superannuation fund, ADF or RSA; and
  • the whole of the interest of the member in the superannuation fund, ADF or RSA is cashed out; and
  • the account in which the interest of the member was held, is closed as soon as practicable after the cashing out of that interest.

Print This Post Print This Post

Posted 28th September 2012 by David Jacobson in Anti-money laundering, Superannuation

September 24, 2012

Further MySuper Bill: tranche 3

The Superannuation Legislation Amendment (Further MySuper and Transparency Measures) Bill 2012 has been introduced into Parliament.

This Bill is the third tranche of legislation implementing the Government’s MySuper and governance reforms as part of Stronger Super.

The first tranche of legislation was introduced to the Parliament on 3 November 2011 as the Superannuation Legislation Amendment (MySuper Core Provisions) Bill 2011 (the MySuper Core Provisions Bill).

The second tranche of legislation, the Superannuation Legislation Amendment (Trustee Obligations and Prudential Standards) Act 2012 (the Trustee Obligations and Prudential Standards Act) received Royal Assent on 8 September 2012.

This Bill introduces the next stage of the reforms.

The Bill:
• bans entry fees and sets criteria for the charging of other fees in superannuation, including rules for the charging of financial advice;
• requires all superannuation funds to provide life and TPD insurance to members (excluding defined benefit members) on an opt-out basis;
• enables APRA to collect information;
• requires the disclosure and publication of key information in relation to superannuation funds;
• allows only funds that offer a MySuper product and exempt public sector superannuation schemes to be eligible as default funds in modern awards and enterprise agreements;
• allows exceptions from MySuper for members of defined benefit funds;
• requires trustees to transfer certain existing balances of members to MySuper; and
• provides rules in relation to eligible rollover funds.

The majority of these provisions will apply from no earlier than the commencement of the MySuper Core Provisions Bill or the Trustee Obligations and Prudential Standards Act, expected to be 1 July 2013.

Print This Post Print This Post

Posted 24th September 2012 by David Jacobson in Superannuation
« Newer PostsOlder Posts »