SuperStream is a government reform that was introduced in July 2014 to improve the efficiency of superannuation payments by employers. The main purpose of SuperStream is to ensure employers pay contributions in a consistent, timely and efficient manner to each employee’s superannuation account. It will minimise the risk of lost super, which has been an issue in the past for the Australian Tax Office (ATO).
Before the introduction of SuperStream, employers most likely had to process employee super contributions to numerous funds in different formats. With the introduction of SuperStream, there now is a simpler, more consistent way to make employee superannuation payments.
SuperStream standardises the super contribution process, so that employers will be able to make all of their contributions in a single transaction, even if the payments go to multiple super funds.
All stakeholders in the superannuation system — employers, funds, service providers and the ATO — will receive the superannuation data in a standardised format. Super payments made through SuperStream will need to be paid electronically by EFT (electronic funds transfer) or BPAY, and compliance with the new system will be monitored by the ATO.
Employers with 20 or more employees were required to implement the SuperStream system by July 2015, and employers with 19 or less employees must implement the system by July 2016. You can start using SuperStream any time before the final date.
Once you start using SuperStream there may be a few more potential benefits, including:
- The opportunity to use a single channel when dealing with super funds, regardless of how many funds your employees contribute to
- Less time spent dealing with employee data issues and fund queries
- Reduced cost of processing contributions and payments
- More timely flow of information and money in meeting your superannuation obligations
The ATO recommends using a three-step approach to implementing the SuperStream system into your business.
Step 1. Choose an electronic option
To meet the standardised format for sending the SuperStream information, you will need to choose a system to do this. Options include your accounting software’s payroll system, your super fund’s online portal and super clearing houses.
Step 2. Update employee and fund information
You may need to collect additional information from your employees, as you must have the following:
- employee tax file number
- fund Australian Business Number (ABN)
- fund unique superannuation identifier (USI)
For employees who have a self-managed super fund (SMSF), you will also need the following:
- fund bank account details
- fund electronic service address
Step 3. Start using SuperStream before the deadline
The ATO recommends making your first SuperStream payment no later than March 2016 so that your system is up and running well before the 30 June 2016 deadline.
To ensure that you are going to be compliant, contact your software provider (or payroll provider if you outsource your payroll), or contact the ATO.
Using MYOB AccountRight? Click here for 4 steps to get SuperStream ready.