SuperStream - are you ready for the changes?
What is the Data and Payment Standard (the standard)?
The standard is a part of SuperStream, a package of measures designed to enhance the superannuation system.
Under the standard, employers will make super contributions on behalf of their employees by submitting data and payments electronically in a consistent and simplified process.
How will the standard benefit employers?
These changes have a range of potential benefits for employers, including:
- a single channel for dealing with super funds, regardless of how many funds contributions are made to
- more automated processing of contributions
- more timely flow of information and money to meet Superannuation Guarantee (SG) obligations
- less unproductive time spent dealing with data issues and fund queries
- reduced processing costs.
Who does the standard apply to?
The standard is mandatory for all employers, APRA-regulated super funds and self-managed superannuation funds (SMSFs).
Why is the standard being introduced?
The main purpose of the standard is to ensure employer contributions are paid in a consistent, timely and efficient manner to a member's account. The change also removes many of the complexities employers currently face as a result of funds being able to set up different arrangements for accepting contributions (due to the lack of a common standard).
What do I need to do to meet the standard?
Every business is different, so there's no 'one size fits all' approach to adopting the standard.
Employers have options for meeting the standard – either using software that conforms to the standard; or using a service provider who can meet the standard on your behalf.
Your options may include:
- upgrading your payroll software
- using an outsourced payroll or other service provider
- using a commercial clearing house or the free Small Business Superannuation Clearing House (19 or fewer employees).
Your default fund may also have some transitional or other arrangements they support. If you already transact electronically with super funds, they will provide you with updated processes and procedures to ensure you comply with the standard.
We recommend that you start investigating your options now.
My clearing house shields me from a lot of this complexity, so why do I have to change?
You may need to provide some additional data fields, including tax file number (TFN) details of your employees, where these have been quoted. However, provided your clearing house submits data and payments electronically on your behalf in accordance with the standard, you will not have to make any changes.
Your clearing house or other service providers will be able to advise you about their plans and what they mean for you.
When do I have to start using the standard?
If at 1 July 2014 you have:
- 20 or more employees (medium or large employer) – you must start using the standard from 1 July 2014
- 19 or fewer employees (small employer) – you must start using the standard from 1 July 2015.
If you are a new employer (that is, you start your business after 1 July 2014) and have:
- 20 or more employees – you must start using the standard from your first contribution date
- 19 or fewer employees – you must start using the standard from 1 July 2015.
The Australian Taxation Office (ATO) will provide flexibility to employers in complying with your obligations under the standard, based on your efforts to get ready, your capabilities, and the particular arrangements you have worked out with your default fund.
My employees are mainly seasonal – am I a small or medium employer?
For the purposes of the standard, all employees at the start date of 1 July 2014 are counted in determining the size of your business.
Example: your business consists largely of seasonal employees – a mix of 5 full-time employees and 17 casual workers.
You will therefore have a total of 22 employees at the start date and will be classed as a medium employer. You must comply with the standard from this date.
If your actual payroll numbers fall below 20 employees at 1 July 2014, you will be classed as a small employer and have another 12 months until you must comply with the standard.
This threshold really only affects your start date for complying with the standard. By 1 July 2015, all employers – no matter what size – are required to meet the standard.