Super stapling is here…

As you may be aware the ATO has introduced a new legislation around superannuation called 'super stapling.

So what is 'super stapling'?
Under the current ‘default’ superannuation system, where an employee commences employment with a new employer and does not choose a superannuation fund into which their super contributions will be paid, their contributions are paid to a default ‘MySuper’ product selected by their employer. This means that a person who changes jobs and does not exercise choice of fund will typically have more than one superannuation account.

However, under the ‘super stapling’ reforms, where a person moves jobs their existing superannuation account will be ‘stapled’ to them, meaning that their new employer must pay contributions into the ‘stapled fund’ unless the member chooses for their contributions to go to a different fund.

What does this mean for employers?
When a new employee commences on or after 1 November 2021, and they do not exercise choice of fund, the employer will need to check if the employee has an existing stapled fund. This is done by logging into ATO online services and providing some basic information about the employee.

Generally, if the employee does not exercise choice and has a stapled fund, the employer will be required to contribute to the employee’s stapled fund to meet their Superannuation Guarantee (SG) obligations.

Source: All That Counts