Is your SMSF ready for SuperStream?

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What is SuperStream?
What’s changed?
Am I exempt?
What is an ESA and why do I need one?
How do I know if my ESA provider will allow rollovers?
What do I do next?
The bottom line

From 1 October 2021 self-managed superannuation funds, with some exceptions, will need to use the SuperStream standard for rollovers into and out of their funds.

Even if you are already using SuperStream for employer contributions into your SMSF, you will need to ensure that your Electronic Service Address (ESA) provider is equipped for rollovers as well.

What is SuperStream?

SuperStream is a data and payment standard introduced in 2014 for all super funds. It was designed to make it easier for super funds to collect employee superannuation guarantee (SG) payments from employers.

Prior to its introduction, some employers were still making SG contributions for employers via cheques in the mail. Not only could these cheques get lost, but super funds reported they sometimes had difficulty matching the cheque to a member, as little explanatory information came with the contribution.

Most SMSFs have been required to receive SG contributions via SuperStream since 3 November 2014, so if your fund is still receiving superannuation contributions you should be accustomed to the process and already have an ESA.

The ATO says that SuperStream offers the following benefits for SMSFs:

More timely and reliable flow of payments and information about contributions, rollovers and certain release authorities
An electronic record to support your accounting and tax obligations (including your SMSF annual return)
Fewer data and payment errors.

What’s changed?

From 1 October 2021 if any of your members want to transfer money from any other super fund to your SMSF (that is, rollover the funds to the SMSF), or transfer funds from your SMSF, which includes when you are winding up your fund, they will have to use SuperStream.

If SMSF members want to receive and action certain release authorities, such as the first home super saver (FHSS) scheme, they will be able to do this faster via SuperStream.

Am I exempt?

There are some exemptions from the requirements to use SuperStream. If your SMSF was exempt from using SuperStream to make contributions, then the same exemptions apply for rollovers.

If the SMSF only receives superannuation guarantee payments from a related party employer (for example a family business) then you will not be required to use SuperStream for rollovers.

And if you make personal contributions to your SMSF, these also do not need to be made via SuperStream.

What is an ESA and why do I need one?

If you have just established your SMSF or have not been receiving contributions, then you will need to register with an SMSF messaging provider to receive an ESA.

The ATO lists the following SMSF messaging providers (which it neither endorses nor recommends):

Australia Post (superannuation@auspost.com.au)
Click Super (support@clicksuper.com.au)
GBST Wealth Management (mywealthmailbox@gbst.com)
SMSFflow (info@smsfflow.com.au)
SuperChoice Services Pty Limited (smsf@superchoice.com.au)
Westpac QuickSuper SMSF Gateway (smsfconnect@westpac.com.au)

If you use an administrator, they may be able to provide you with an ESA. The following SMSF administration service messaging providers are only available to existing clients:

AMP SMSF Solutions (smsf_solutions@amp.com.au)
Ascend Self Managed Super (admin@ascendsmsf.com.au)
BGL (info@bglcorp.com.au)
Class Super (support@class.com.au)
ClearView Wealth Solutions Investments (service@clearview.com.au)
Colonial First State Custom Solutions (customercare@colonialfirststate.com.au)
superfund (info@esuperfund.com.au)
Macquarie Bank Limited (transact@macquarie.com)
Mercer Portfolio Service Investment Plan (mercerportfolioservice@colonialfirststate.com.au)
netwealth (contact@netwealth.com.au)
SMSF DataFlow (support@smsfdataflow.com.au)
SuperConcepts (support@supermate.com.au)
SuperGuardian (info@superguardian.com.au)
TheSMSFManagers (support@thesmsfmanagers.com.au)
The Super Group (info@supergroup.com.au)
Xpress Super (info@xpresssuper.com.au)

How do I know if my ESA provider will allow rollovers?

If you already have an ESA you need to contact your provider to confirm that they will be providing rollover SuperStream services as well and, if so, when this will happen. If you use an administrator for your SMSF, they should be able to help you with this or you can contact them directly. If you have had an ESA in the past, but have not used it recently, confirm with the provider that it is still active.

What do I do next?

Once you have your ESA or have confirmed that your messaging provider will provide rollover services, you need to update the ATO with the information.

Your SMSF will also need an Australian Business Number, which you can apply for via the Australian Business Registrar. The ATO needs to be updated with this information as well.

Finally, you need to make sure that all your other information is updated and current with the ATO, including your SMSF’s bank account details.

You can do this yourself via myGov and ATO online services, via your tax agent or by contacting the ATO directly.

Case study examples

Following are some case studies of how SuperStream might work, based on ATO examples.

SuperLiving SMSF has three members. A husband and wife and their son. The man is self-employed, and therefore meets the related party exemption, but the wife and son both work for other non-related employers. The SMSF still needs to be able to receive employer contributions and rollovers using SuperStream. The wife and son must provide their employers with details of the SMSF’s ABN, bank account and electronic service address so their employers can implement SuperStream.

The youngest member of SuperLiving SMSF has just got married and his husband wishes to join SuperLiving SMSF as well. He also works for a non-related party employer. He will need to request a rollover of his balance with an existing APRA fund into SuperLiving SMSF. This transfer request can be made via ATO online services or a paper form but from 1 October 2021 the rollover into an SMSF will need to be received via SuperStream. Fortunately, SuperLiving SMSF is already using SuperStream and has an active ESA and ABN. Once the rollover is made the newest member of SuperLiving SMSF will need to provide the SMSF’s ABN, bank account details and ESA to his employer so they can implement SuperStream for future contributions.

The bottom line

It may seem like an inconvenience to get your SMSF up to date with the SuperStream requirements, but over the long term it should make your life as an SMSF trustee much easier by facilitating faster rollovers with a reduced potential for error.