Superannuation

CORPORATE SUPERANNUATION

As some employers struggle with the everyday running costs of their business, employee superannuation is often just another payment. However, the significance of the payments when bundled into a single corporate super account can create a buying opportunity that can be advantageous to all parties.

Superannuation guarantee obligations have recently increased which come with strict compliance and require an increased level of administration. So as a business, you may need to review your current arrangements.

Often employees and staff are unaware of their options and whilst industry funds advise you of their superior market position due to lower fees, they don’t give away personalised or holistic advice, you pay for it.

Small employers have a decided advantage in that they know their employees, often dealing with them on a day to day basis. The benefits of a corporate plan can be significant when looking at each employee’s financial commitment to insurance and advice costs. In addition, availability to maximise an individual’s tax position can include co-contribution, salary sacrifice, and spouse contributions

If you’re an employer and you’re already paying the Super Guarantee Contribution, give us a call and see if what we have to offer can improve your position.

EMPLOYEE SUPERANNUATION

My Super is a new Federal legislation that commenced on 1st January 2014. At that time, any worker that had allowed their super contributions to go into a standard default fund, (one nominated by their employer), now has these funds paid into a My Super account.
Fund managers also automatically established and redirected contributions to this My Super account. So in some circumstances, members may now have two funds – post 1 Jan 2014.

The intent of the My Super legislation is to improve standards for employer default superannuation arrangements, which includes fewer permitted fees, bringing about limited product features and includes the removal of all adviser commissions.

Whilst the legislation has created this national fund type, “My Super”, enabling a simple generic fund cost comparison, what may have been more appropriate, they have not structured a basic investment style. It is therefore up to each fund manager to establish their particular approach to their default investment.

There are many reasons as to why the action was instituted but a key reasoning was as result of how disengaged a great percentage of Australians are with regard to this important asset.

For the financial services industry My Super was another piece of legislation that was bundled into a further piece of legislation called Future of Financial Advice (FoFA), Under FoFA legislation certain existing retail super accounts can continue.

However, in cases where the fund has not received an instruction from the member, under My Super rules, a new account may need to be opened and new contributions are directed to this account. Whilst the balance of the previous fund stays where it is unless you decide to move the whole amount of your existing balance into the new account.