The Taxation Office has introduced a new feature called a 'stapled super fund'.
So that employees who change jobs several times don't end up with deposits in multiple funds the "stapled" super account will follow them from job-to-job.
This also applies to contractors who are employees for superannuation purposes.
From November 1, 2021, if you start a new employee, you need to first offer them a choice of super fund. They can choose a super fund account they already have or choose your default fund.
If they don't make a choice, you need to request their stapled super fund details from the tax office. This does not apply to employees who started prior to that date.
Before you can make the request to the tax office they need to be able to see that there is an employment relationship between yourself and the new employee. This can be done by submitting a Tax File Number Declaration or lodging a Single Touch Payroll Event for that person.
The request can be done via the ATO online services if you have registered for this or your accountant can do the request for you. If details are entered correctly the system should notify you of the result within minutes on screen.
The employee will also be notified that a request has been made. If you don't have access to online services you can phone the ATO but you must be the primary contract for the business as they will need to establish your identity.
As contractors are not included in the Single Touch Payroll function you will need to lodge a request using the mail function in online services and attach a signed written contract to prove they are contracting to you. There is also a manual form that can be completed and mailed to the ATO.
The current minimum superannuation is 10 per cent of an employee's ordinary time earnings and is going to progressively increase to 12pc by 2025. Penalties can be applied for late or incorrect payment of superannuation so if unsure please phone the ATO, a HR consultant or your accountant.
- Helen Warnock is a partner in a Central Queenland Chartered Accountant firm. This article offers general information only. You should consult your personal advisor to seek advice relevant to your personal circumstances before taking action.
