Superannuation Alert - 11.4.13

Financial Services eBulletin - 11 April 2013

The Lander & Rogers Superannuation Alert is a brief overview of new developments in the superannuation industry and is in addition to our Superannuation Update, which analyses the main developments of interest in more detail.

  • On 22 March, APRA added new and updated FAQs to its website relating to its Prudential Standards and Governance. These include FAQ 46, which requires RSE licensees to submit up to date executed trust deeds or governing rules when lodging a MySuper Application.
     
  • On 28 March 2013 APRA released its proposed final reporting standards, forms and instructions package, which includes 35 revised reporting forms for APRA-regulated superannuation funds.
     
    • The new standards comprise new accountability requirements and reflect the introduction of MySuper and SuperStream
       
    • From 1 July 2013, 24 of the final reporting standards will take effect, and the remaining 11 will take effect from 1 July 2014.
       
    • APRA has also released a new FAQ to its website which explains why the reporting forms released on 28 March 2013 are described as "proposed" rather than "final".
       
    • On 28 March 2013 APRA issued a media release summarising the new requirements.
  • On Friday 5 April, the Government announced a number of significant superannuation reforms to "improve the fairness, sustainability and efficiency of the superannuation system." The reforms include: 
      
    • A cap on tax-free pension earnings at $100,000;
       
    • Withdrawals from super of persons aged 60 or over remains tax free;
       
    • A $35,000 concessional contributions cap for people aged 60 and over from 1 July 2013 (or 1 July 2014 for people aged 50-59), replacing the general concessional cap of $25,000;
       
    • All individuals will be able to withdraw from their superannuation fund any excess concessional contributions made from 1 July 2013. The withdrawn excess contributions will instead be taxed at the individual's marginal tax rate (plus an interest charge);
       
    • An extension on deeming rules for account-based pensions;
       
    • Deferred lifetime annuities will be granted the same concessional tax treatment that superannuation assets supporting income streams receive;
       
    • The account balance threshold above which inactive accounts must be transferred to the Tax Office will be increased from $2,000 to $2,500; 
       
    • The establishment of a Council of Superannuation Custodians.

       
  • On Friday 5 April, ASIC released four information sheets which outline ASIC'S expectations in relation to key aspects of the Stronger Super reforms: 
     
    • Information Sheet 168 - Giving and collectively charging for intra-fund advice defines intra-fund advice, the restrictions on collectively charging for advice and how the Future of Financial Advice reforms apply to intra-fund advice
       
    • Information Sheet 167 - Disclosure requirements for superannuation trustees: s29QC covers the requirement under section 29QC of the Superannuation Industry (Supervision) Act 1993 for super trustees to use the same calculation methodology when providing information to a person or on a website as it uses when giving the same or equivalent information to the Australian Prudential Regulation Authority under a reporting standard.
        
    • Information Sheet 169 - Notifying members about superannuation transfers: Accrued default amounts (MySuper transition) addresses requirements under section 29SAA(3) of the SIS Act and regulations under which a super trustee must provide a notice to a fund member with an ‘accrued default amount’ regarding an intended transfer or attribution to a MySuper product in the same fund, or to another fund within specific timeframes.
       
    • Information Sheet 90 - Notifying members about superannuation transfers without consent has been updated to explain the requirements for disclosure to members where there is a 'significant event' or 'material change' regarding their super fund. The update in part reflects the Stronger Super changes but also recognises the fact that the Stronger Super reforms may result in an increase in successor fund transfers more generally.

Further information

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.

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