Only four of the outstanding superannuation measures are proceeding. The measures the government has agreed to proceed with are:
i. Superannuation — greater certainty in relation to fund mergers: This clarifies that the proportioning rule in the superannuation tax law does not apply to fund mergers. This is to assist fund mergers and allow for further consolidation of the marketplace.
ii. Stronger Super — unlawful payments from regulated superannuation funds: This targets the promotion of illegal early release schemes and introduces penalties for promoting schemes designed to obtain the illegal release of superannuation benefits.
iii. Stronger Super — self managed super funds administrative directions and penalties: This gives the Tax Office flexible and cost-effective penalty options to deal with SMSFs that breach the law.
iv. Superannuation reforms — transfer of lost member accounts to the ATO: This increases the threshold below which lost accounts are required to be transferred to the ATO from $2,000 to $4,000, and then to $6,000. This measure will allow more “lost accounts” to be transferred to government revenue.
The measures the government is not proceeding with are:
i. Imposing a tax for earnings on superannuation assets supporting retirement income stream: This would have involved a tax on investment earnings above $100,000 a year on superannuation assets supporting retirement income streams.
ii. Reforms to retirement incomes — establishment of a council of superannuation guardians: This would have involved the creation of the Super Council or the Charter of Superannuation Adequacy and Sustainability.
iii. Superannuation — clarifying the operation of certain superannuation trust deed clauses: This was intended to ensure trust deed clauses cannot be used to prevent excess amounts from being counted as contributions.
iv. Superannuation reforms — encouraging the take-up of deferred lifetime annuities (DLAs). This was intended to encourage the take-up of DLAs by providing these products with the same concessional tax treatment that applies to investment earnings on superannuation assets supporting retirement income streams. This measure will now be considered as part of the proposed review of the regulatory arrangements for retirement income streams.
v. Stronger Super — implementation of SuperStream reforms (stronger super reforms — inter-fund consolidation of accounts less than $1,000): This would have required the ATO to initiate consolidation of certain members’ superannuation accounts. Affected funds are then required to facilitate consolidation between funds unless the member opts out.
vi. Self-managed superannuation funds — acquisitions and disposals of certain assets between related parties:. This would have prescribed rules for the acquisition and disposal of certain assets between SMSFs and related parties.
vii. Superannuation — verification of self-managed superannuation funds members and bank accounts: This was intended to ensure superannuation money is transferred to a valid SMSF bank account and provide a register so APRA funds can check SMSF details to meet data and e-commerce standards.
viii. Stronger Super — self managed super funds — rollovers to SMSF: This was intended to make rollovers to SMSFs a “designated service” under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (AML-CTF), requiring super funds to introduce additional checks and safeguards.
ix. SuperStream — transferring superannuation contributions with no TFN to the ATO: This would have required superannuation funds to transfer superannuation contributions without an associated tax file number to the ATO as unclaimed money.
x. Stronger Super — unlawful payments from regulated superannuation funds — income tax rates amendment. This would have taxed super benefits received illegally at 45% plus Medicare levy.
xi. SuperStream — new employee engagement process: This would have integrated processes for tax file number declaration and choice of superannuation fund and prompted members to consolidate accounts.
xii. Superannuation — SuperStream — require funds to report contributions either quarterly or every six months: This would have required funds to notify members whether contributions have been received, either quarterly or six monthly (to alert members about unpaid superannuation).