Superannuation Alert 27.06.18
Financial Services - 27 June 2018
Federal Parliament - Superannuation Guarantee Amnesty Bill 2018 passes the House of Representatives
On 20 June 2018, the Treasury Laws Amendment (Superannuation Measures No.1) Bill 2018 (Bill) passed the House of Representatives without amendment, and is now before the Senate.
As noted in previous Alerts and according to the Explanatory Memorandum, the Bill includes the following measures:
- "a one-off 12-month amnesty to encourage employers to self-correct historical Superannuation Guarantee (SG) non-compliance";
- an SG opt-out mechanism for high-income employees with multiple employers, to prevent unintentional breaches of the concessional contributions cap;
- the extension of the non-arm's length income rule to "situations where a superannuation entity incurs non arm’s length expenses in gaining or producing the income"; and
- amendments to limited recourse borrowing arrangements.
Federal Parliament - Federal Budget's Superannuation Package Bill introduced
On 21 June 2018, the Treasury Laws Amendment (Protecting Your Superannuation Package) Bill 2018 (Bill) was introduced into the House of Representatives. The Bill proposes to give effect to a number of superannuation related changes announced in the Federal Budget.
According to the Explanatory Memorandum, the Bill introduces measures to protect against "the erosion of retirement savings of low balance accounts through fees and premiums for default insurance". The measures include:
- capping superannuation fees at "3 per cent of the balance of a MySuper or choice product annually where the balance of the account is below $6,000";
- not permitting exit fees to be charged on any "superannuation accounts, regardless of a member’s account balance";
- preventing "trustees from providing opt out insurance to new members aged under 25 years, members with balances below $6,000 and members with inactive MySuper or choice accounts"; and
- requiring "the transfer of all superannuation savings with balances below $6,000 to the [ATO] if an account, related to a MySuper or choice product has been inactive for a continuous period of 13 months".
The date of effect is 1 July 2019.
The Bill has been referred to the Senate Economics Legislation Committee for report by 13 August 2018.
ASIC - Regulatory Guide 267: Oversight of the Australian Financial Complaints Authority
On 20 June 2018, ASIC released Regulatory Guide 267: Oversight of the Australian Financial Complaints Authority (AFCA) (RG 267). According to ASIC, RG 267 "sets out how [ASIC] will perform [its] oversight role in relation to AFCA. It also includes the financial firms’ AFCA membership obligations".
ASIC notes that RG 267 should be read in conjunction with RG 165.
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