Superannuation Alert - 28.3.14
Financial Services eBulletin - 28 March 2014
The Lander & Rogers Superannuation Alert is a brief overview of new developments in the superannuation industry.
- On 18 March 2014, the Tax and Superannuation Laws Amendment (2014 Measures No. 1) Bill 2014 (Cth) was assented to. This Bill makes a number of amendments to the Superannuation Industry (Supervision) Act 1993, including:
- the insertion of a new s 68B (Promotion of illegal early release schemes) to prescribe that a person must not promote a scheme that has resulted, or is likely to result, in a payment being made from a regulated superannuation fund otherwise than in accordance with the payment standards prescribed under s 31(1).
- The insertion of a new Part 20 (Administrative directions and penalties for contraventions relating to self-managed superannuation funds) to introduce administrative directions and penalties for contraventions relating to self managed superannuation funds (SMSFs) including rectification directions, education directions and administrative penalties.
- On 19 March 2014, the Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014 was introduced into the House of Representatives. On 20 March 2014, the Bill was referred to the Senate Economics Legislation Committee which is due to report on the Bill by 16 June 2014. The Bill proposes a range of amendments to the Corporations Act 2001, to give effect to the government's proposed FoFA reforms to reduce the regulatory burden on the financial industry. The major amendments include:
- the removal of the "catch-all" provision in s 961B(2)(g) of the Corporations Act 2001, relating to the steps that an adviser must take to show that they have acted in the best interests of their client;
- the modification of the best interests duty to better allow for partial or scaled advice which is limited in scope and does not constitute a holistic financial plan;
- the provision of an exemption from the ban on conflicted remuneration for general rather than specific financial advice in particular circumstances;
- the removal of the requirement that advisers provide an annual financial disclosure statement to clients that entered into their arrangement prior to 1 July 2013; and
- the removal of the requirement that clients and advisers renew their ongoing fee arrangement every 2 years.
- On 19 March 2014, the Federal Court handed down its decision in FCT v Dowling. In a test case funded by the ATO, Greenwood J set aside an AAT decision after finding that it "fell into error" in the way it applied the Commissioner's discretion to disregard certain excess non-concessional superannuation contributions under ss 292-465 of the ITAA 1997.
- On 20 March 2014, the ATO issued SuperUpdate March 2014. The main topics covered include:
- Division 293 tax assessments for the 2012-13 financial year have year started issuing to affected individuals in late January 2014, with larger volumes expected to issue over the coming weeks
- TFN Notification and SuperTICK are two initiatives being implemented to improve the provision of member tax file numbers (TFNs) to super funds;
- the Electronic Portability Form (EPF) User Guide has been enhanced to prevent EPFs being sent to funds/accounts not subject to compulsory portability;
- the publication Super contributions caps; and
- the undertaking of a project to target contemporary SMSF products and services to a broader audience in the community and will deliver content in a manner that fosters greater engagement and understanding of the information.
- On 20 March 2014, the ATO published "Illegal super schemes - beware of offers to withdraw your super early". The article provides information on how illegal superannuation schemes operate and the penalties for withdrawing super early.
- On 21 March 2014, APRA issued a letter to all RSE licensees confirming the following changes to APRA's reporting requirements for superannuation:
- the due dates for quarterly superannuation data collections for a transitional period;
- deferral and further consultation on select investment option reporting; and
- the superannuation data collection for the purposes of the Australian Bureau of Statistics (ABS).
- On 21 March 2014 APRA and ASIC issued a letter to all RSE licensees to explain the relationship between the disclosure requirements administered by ASIC and the data that is required to be reported under APRA's reporting standards as a result of section 29QC of the Superannuation Industry (Supervision) Act 1993 (SIS Act).
All information on this site is of a general nature only and is not intended to be relied upon as, nor to be a substitute for, specific legal professional advice. No responsibility for the loss occasioned to any person acting on or refraining from action as a result of any material published can be accepted.