The SMSF Association has welcomed draft regulations recently tabled in Parliament to allow SMSFs to receive digital rollovers through the SuperStream system.
SMSF Association acting chief executive Jordan George particularly welcomed the federal government taking note of its submission on the matter and its clarification on the operation with regard to non-concessional and member-related contributions.
SMSFs will now only need to obtain a digital address and provide it to the ATO if they receive a contribution (other than a contribution from a member or a related-party employer), a rollover or transfer of a member’s withdrawal benefit.
The association proposed this carveout in its submission to Treasury on the draft regulations in early August.
“As a consequence, SMSFs no longer receiving rollovers or employer contributions will not have to enter the SuperStream system just because they receive a once-off, non-concessional or member-related contribution,” George said.
“If non-concessional contributions did fall into the remit of the SuperStream regulations, it had the potential to create a compliance burden for SMSF trustees, especially for older and established SMSFs that don’t receive employer contributions and have no real need for SuperStream. Typically, these SMSFs just receive contributions directly from the member.”
He added older trustees in retirement or transitioning to retirement and only receiving non-concessional contributions will not need to transition until a more suitable time is identified.
“Not only will this reduce the burden on the trustee, it will also reduce the burden on professionals and the regulator who will need to implement the transition,” he said.
The explanatory statement accompanying the exposure draft regulations said if an SMSF never receives a contribution, rollover or transfer of a member’s withdrawal benefit, it is not required to provide the ATO commissioner with a unique superannuation identifier, bank details that can receive electronic payments and an internet protocol address or other digital address that allows for SuperStream communication.
George also said the government’s decision to table the draft regulations will extend the operation of SuperStream to SMSFs from 30 November 2019 and clarifies when SMSFs are required to enter the system.