Legislation was introduced as part of SuperStream to standardise the way employers pay and report superannuation contributions.
From 1 July 2014, employers with 20 or more employees will be required to use the Data and Payment Standard (the standard) when making superannuation contributions.
The standard requires payment and data to be sent electronically. This will ensure that employer contributions can be streamlined and allocated to a member’s account in a timely and efficient manner.
The benefits for employers will be a simpler and more consistent method of making super contributions and no longer needing to provide information to separate funds in different formats.
For employers with less than 20 employees, the start date for complying with the standard for superannuation contributions is 1 July 2015.
The standard requirements are as follows:
- Data such as the employee’s details and amount of superannuation being paid must be sent electronically in a standard message format;
- Contributions must be made electronically;
- Electronic data and money must be linked with a unique payment reference number; and
- Electronic data and fund transfers must be sent on the same day.
Employers must ensure that they respond to fund requests for complete information within 10 business days.
Penalties for non-compliance may apply under the Superannuation Industry (Supervision) Act 1993.
Options available to ensure compliance
The following are options available to ensure that your business will have the necessary processes in place to comply with the requirements of the standard:
- Upgrade your payroll software to a software that conforms to the standard;
- Engaging a service provider such as your tax agent, a payroll bureau or a bookkeeper;
- Using a clearing house; or
- Working with your superannuation funds who may have an online solution.
The government provides a free clearing house service for small businesses with 19 or fewer employees to help them meet their superannuation guarantee obligations. For further information about this free service, please contact your Blaze Acumen adviser.
What this means for you as employers
You should assess your current business process to determine what option would be the most suitable to ensure that you will be compliant with the standard.
If you have any questions or require any assistance to ensure that your current business process will be compliant, speak to your Blaze Acumen adviser.