A. What to consider as an employer
How super choice works?
Super choice is all about allowing employees to choose the MySuper product or super fund they want. They don't have to use the one chosen by someone else such as their employer, industrial award or work place agreement.
How super choice affects a company
Super choice gives employees the option to leave the default MySuper product or fund that was chosen for them and go to another MySuper product fund. But only if they want to. The point is they now have a choice.
This doesn't mean they have to choose or that they even have to look at other options, and it definitely doesn't mean they need to assume there is something wrong with their employer's default MySuper product.
But equally it doesn't mean employees can choose any super fund they want either. They have to already be a member of the super fund they choose, and it has to be willing to accept their super contributions, without difficulty, from their employer.
Also, if an employee decides to exercise their rights under super choice and join a different fund, those super funds aren't allowed to force the employer to become a "participating" or registered employer of that fund.
How companies choose default MySuper products
Under super choice, employers have to ask their employees at least once a year what MySuper product or super fund they would like to have their super contributions sent to. To help employers handle this, the Australian Taxation Office (ATO) has designed a form for employers to hand to employees to they can nominate their preferred super fund.
A copy of this form is available on the ATO and Selecting Super websites.
|Employers - if an employee wants super choice
Employees who want to make a super choice have to fill in a Super Choice form and provide the following information to their employer:
This technical resource is intended for the use of financial advisers only. It is current as at the date of publication but may be subject to change. This publication has been prepared without taking into account a potential investor's objectives, financial situation, needs or objectives. Before making a recommendation based on this material, you should consider its appropriateness based on the client's objectives, financial situation and needs. Rainmaker Group is not a registered tax agent under the Tax Agent Services Act 2009. Your client should refer to a registered tax agent before relying on information published herein that may impact their tax obligations, liabilities or entitlements.
Last modified: Monday, October 26, 2020