superstream - major problem for SMSFs

Discussion in 'Superannuation' started by phacoboy, Sep 7, 2012.

  1. phacoboy

    phacoboy New Member

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    Superstream is a "reform" to be implemented July 2013 that in its current form would make it very hard for a SMSF to receive member contributions or rollovers.

    I have blogged the findings of my research into the topic http://eyehealth.bees.net.au/2012/09/is-superstream-strategy-to-kill-self.html

    most accountants, financial planners and software vendors seem to know nothing about it

    what have readers done to get ready ?
     
  2. clubman

    clubman Member

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    --> No employer contributions - including salary sacrifice will be possible into your SMSF from July 2014 or even earlier if your employer implements the "reforms" early voluntarily.

    This is harsh...
     
  3. hiho

    hiho Active Member Silver Stacker

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    the unions are behind this, industry super funds the unions
     
  4. RhythmDoctor

    RhythmDoctor Active Member

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    The point within a circle...
    Sounds particularly worrying for me then. I've not even rolled over yet - its obviously worth rolling over now but what about further contributions in future?
     
  5. Elemental

    Elemental Active Member Silver Stacker

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    Accountants are aware and our professional groups are in consultation with policy makers. I'm not sure if it will be implemented in it's current propsed form.

    Time will tell.
     
  6. Jislizard

    Jislizard Well-Known Member Silver Stacker

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    My employer won't pay into my SMSF anyway, they will only pay into UniSuper and I have to top-up into that as well in order to get the extra 3% employer contributions. I just hope they don't lose it all before I can transfer it across.

    I guess the Gov really doesn't want to encourage people to be self reliant.

    Of the 31% of superfunds that are SMSF according to your link (thanks for that), what percentage are with someone like eSuperfund? They should be all over it.
     
  7. null

    null Member

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    Quickly read the link.

    More like they want to streamline the funds transfer from contributions to the fund that's all. Not sure why it's not possible for employer to transfer funds if implemented...

    Why would it be "... hard for a SMSF to receive member contributions or rollovers."? If you are on this esuper fund thing, well the employer is currently paying into the ANZ V2.

    I have been to an XBRL info session, yes, the implementation is still WIP, but it's more to do with streamlining payments to the funds. Also, when you are doing a rollover now, you need to fill in paper forms. With electronic transfer, it will just be quicker, that's all. It's up to the employer / funds, to implement the changes.

    Maybe I am not reading it wrongly ...
     
  8. boston

    boston Well-Known Member Silver Stacker

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    Perhaps you are more trusting of the ATO than me.

    But, and it is a big but, no government initiates changes, that costs $ millions, unless there is a financial reward in the outcome for the government.
     
  9. Big A.D.

    Big A.D. Well-Known Member Silver Stacker

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    Is there an organized SMSF "lobby group" that advocates specifically for people with SMSFs?
     
  10. Jislizard

    Jislizard Well-Known Member Silver Stacker

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    I have a SMSF but I have not heard of any lobby group. I would have thought that it is going to be accountants who will lose business if the SMSF wind up. I am sure they will act in their own interests and they are probably more organised than us.
     
  11. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    @phaco, actual links to where it actually says the stuff you say will happen
     
  12. Slam

    Slam Well-Known Member Silver Stacker

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    Ok, if I reading this correctly.

    In order for a fund to receive rollover or contributions. It must be electronic and adhere to the form of transfer set out in the reform.

    The reform specifies certain technologies (Webservice, protocols (HTTP over SSL) and format) to conduct the rollover / contribution and pay into a certain account (your SMSF).

    Now this is up to the industry funds (for rollovers) or employers (contributions) to see whether they want to follow this reform and implement the technology so that its possible to rollover and pay contributions into the SMSF account.

    The problem with this means, industry funds will shrug it off, why should we build something and support this. Tough you guys cant roll over any more. Most if not all industry funds will start with this and maybe implement something later if they get backlash from fund members.

    For employers this is a big deal, most of them may not want to build / develop or even purchase a system or software to do super contributions just for yourself or your only 1 out of 50 of employees that have a SMSF.

    Hrmm, my financial controller of the company users Esuperfund. I'm sure I may need to assist him in actually getting something up for my benefit.

    So in short if I read correctly, this is basically hurdles to make it harder for you to transfer funds to SMSF under the disguise of streamlining and technology efficiency.

    If there is 31% of people with SMSF and growing, effectively this is a run on the industry funds. Noticed the BS ads on primetime TV these days. Theres really been an increase in Industry Superfunds for your business. Too bad I bailed 3 years ago and never looked back.

    Maybe I can write or develop a software piece for this integration for transfers. Since I am already building webservices, encrypted using SSL as the transport for a big retail bank Not hard for me to adhere to whatever the super reformers want to do.

    Just a pain in the ass making it harder for people to access their own funds. I really hope it doesn't passthrough.

    Edit: Industry superfunds will provide / give software to employers to pay into their funds if they can sign up members. They will implement the reform technology required to receive contributions and payments.

    Esuperfund will have to work with ANZ (V2) and actually come up with a similar strategy for receiving contributions for us members in our own superfunds. At the end of the day we are paying for the service from esuperfund. They choose the V2 account for us. Maybe its time to draft and email to them and ask them what their comments are to these potential reforms.

    Slam
     
  13. boston

    boston Well-Known Member Silver Stacker

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    Bingo!
     
  14. Shaddam IV

    Shaddam IV Well-Known Member Silver Stacker

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    The Australian public need to hire a Canberra lobbyist so that there is at least one person in Parliament house that is attempting to represent us. No-one there is. :)
     
  15. Jislizard

    Jislizard Well-Known Member Silver Stacker

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    Harder but not impossible.

    I guess that means we are on the right track, if it was too easy everyone would be doing it!
     
  16. phacoboy

    phacoboy New Member

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    You've got the idea. There are not 31% of members but 31% of funds so the average SMSF balance is much much larger - the sort of people Labor generally targets.

    Like you I looked at developing my own software but the nature of the encryption is not clear (AUSKEY seems unfit for this purpose). You will also need to study the standard. A business opportunity exists for someone to develop a sink to receive these messages from the employers and then the SMSFs will just continue to operate as per normal with allocating funds as they appear in the bank account - Most funds have 1 or 2 members only anyway.

    It seems a move to force the money back into industry funds and remember that rollovers from those funds into your SMSF won't be possible either. Don't know about esuperfund but they will need to tie their system to your encryption key, ABN and bank account
     
  17. mmm....shiney!

    mmm....shiney! Administrator Staff Member Silver Stacker

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    Where does it actually say this phaco? I can't find the relevant information.

    and

    Source: http://eyehealth.bees.net.au/2012/09/is-superstream-strategy-to-kill-self.html

    Please provide a link.

    The software implications escape my understanding, but from my quick reading of it, there is no need for employers to develop their own software at all. They can make use of payroll software packages that already exist, or use the Medicare Clearinghouse. Larger corporations that have their own software obviously will have no trouble upgrading their payroll packages because they have people that do that sort of stuff.
     
  18. phacoboy

    phacoboy New Member

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    from http://strongersuper.treasury.gov.a...publications/information_pack/superstream.htm website

    3.2.1 Timeline
    The implementation timeline for the data and e-commerce standards is as follows:

    Early 2012: Data standards published and available for use by funds (voluntary uptake).
    July 2013: Data standards and use of e-commerce becomes mandatory for APRAregulated funds and SMSFs for processing rollovers and accepting contributions (provided by employers in the new format).
    July 2014: Data standards and use of e-commerce becomes mandatory for large and medium employers making contributions.
    July 2015: Proposed application of data standards and use of e-commerce to small employers subject to further consultation on impacts.
    The Government will continue to consult with relevant stakeholders on implementation issues.


    I agree that there will be little impact on employers with less than 19 employees as they can use the medicare clearing house. Employers with more than 19 employees can use the MercerSpectrum or similar product and remember that these changes won't affect the employers until July 2015

    The issue is for the SMSF's themselves to be able to receive and process the contributions. This Govt is not likely to care much for SMSF trustees
     
  19. Roswell Crash Survivor

    Roswell Crash Survivor Well-Known Member Silver Stacker

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    Too early to tell.
     
  20. nonrecourse

    nonrecourse Well-Known Member

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    Actually there are about 480,000 SMSF's with about 900,000 members that represents 7% of all Australians who are in self managed super.They are regulated by the ATO and as a group they control 31% of the 1.4 trillion that is held in super

    Contrast that with just over 350 funds regulated by APRA of which retail, industry, government and corporate of which 93% of Australians are in these funds. So these big funds when compatred to the number of SMSF's, the APRA funds make up just .00072917%

    So the number of SMSF's represent 99% +++ with the largest slice of the pie for just 7% of the population


    Yes well the labour party if it is in much longer will destroy SMSF's

    Kind Regards
    non recourse
     

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