Insights – Super Stapling starts 1 November 2021.
A stapled super fund is like a default fund for an employee – it stays with them even when they change jobs with the aim of reducing the number of super accounts that a person accumulates throughout their working life.
The stapled super requirements come into force from 1 November 2021 for all new employees and also applies to contractors who are paid mainly for their labour and are eligible for superannuation guarantee payments.
Your requirements as an employer:
1. Give new employees a choice of super fund
As per current legislation, in the first 28 day s of employment you still need to provide a new employee with a Superannuation standard choice form | Australian Taxation Office (ato.gov.au). They can choose their own fund or your default fund for you to make contributions on their behalf.
2. If the employee does not choose a fund you will need to identify their stapled fund from the ATO.
Log onto the ATO online services and provide your employee details (TFN, name, date of birth, address) to search for their stapled fund.
You will need to have submitted a Tax File Number declaration or lodged a STP pay event so that their details are linked to you.
Where a stapled super fund cannot accept contributions you will need to contact ATO for advice.
Where a stapled super fund is an SMSF you will need to obtain the electronic services address and bank account details from the employee.
3. Pay employees to their nominated or stapled fund.
Pay your employees by the due date, 28 days after the end of each quarter into their chosen or stapled fund.
Failing to complete these obligations can result in penalties including 25% of super contribution up to $500 per employee for not providing employees with a choice of super fund.
To prepare for the change you should have make sure you have access to ATO online services so you are ready to comply from 1 November.
Contact Alto if you need clarification around your super requirements for employees or need help to check an employees stapled fund.
Author: Donna Bruce