When your business hires a new employee, the Choice of Fund form is used to identify where they want their superannuation to be directed. If the employee does not identify a fund, generally the employer directs their superannuation into a default fund.
From 1 November 2021, where an employee does not identify a fund, the employer is required to contact the ATO and request details of the employee’s existing superannuation fund or ‘stapled’ fund (a stapled super fund is an existing super account of an employee that follows them as they change jobs). The request is made through the ATO’s online services through the ‘Employee Commencement Form’.
If the ATO confirms no other fund exists for the employee, contributions can be directed to the employer’s default fund or a fund specified under a workplace determination or an enterprise agreement (if the determination was made before 1 January 2021).
This change aims to stop your new employees paying extra account fees for unintended super accounts set up when they start a new job.
What you need to know
You may need to request stapled super fund details when:
- your new employee starts on or after 1 November 2021
- you need to make super guarantee payments for that employee, and
- your employee is eligible to choose a super fund but doesn’t
You may still need to request stapled super fund details for some employees even though you don’t need to offer them a choice of super fund. This includes if your employees are temporary residents or they’re covered by an Enterprise Agreement or Workplace Determination made before 1 January 2021.
You and your representatives can request stapled super fund details for your employees if you have full access to Online services for business. You need to review and update these accesses to protect the privacy and safety of your employees’ personal information.
You must meet your choice of super fund requirements and any stapled super fund obligations by the quarterly due date or you may face penalties.
What you need to do from 1st November 2021
Step 1: Offer your eligible employees a choice of super fund
You need to give your eligible new employees a Super standard choice form and pay their super into the account they tell you on the form. Most employees are eligible to choose what fund their super goes into.
There is no change to this step of your super obligations.
Step 2: Request stapled super fund details
If your employee doesn’t choose a super fund, you may need to log into the ATO’s Online services and go to ‘Employee Super Accounts’ to request their stapled super fund details. Your agent or other tax professional can do this for you.
The ATO will will provide your employee’s stapled super fund details after they have confirmed that you are their employer.
If we provide a stapled super fund result for your employee, you must pay your employee’s super using the stapled super fund details provided.
Step 3: Pay super into a default fund
You can pay into a default fund, or another fund that meets the choice of fund obligations if:
- your employee doesn’t choose a super fund, and
- the ATO have advised you that they don’t have a stapled super fund.
You can find out more about Stapled Superfund’s on the ATO website. If you wish to speak to someone about this information, give us a call on (03) 9810 3666 or call the ATO directly on 13 10 20.