ATO highlights billions in forgotten super
The ATO is encouraging those with multiple super funds to consolidate their super into one account, with 45 per cent of working Australians currently holding more than one super fund.
According to the ATO, this figure is lower overseas with only 26.2 per cent holding multiple pension funds.
Based on statistics from the Australian Prudential and Regulation Authority, the ATO said the median figure for fees and charges paid by Australians for a low cost super account is $532 per year.
The ATO said Australians are currently wasting thousands of dollars every year and by combining their super into one account will reduce the amount paid in annual fees.
ATO assistant commissioner of superannuation John Shepherd said it is not uncommon for people to open a new super account when they start a new job instead of taking their super fund with them when they change jobs.
“People might also have super accounts which they have lost track of, for example, they may not have updated their contact details with their funds when they moved house – there are still $5.8 billion worth of accounts in this category,” he said.
Mr Shepherd said there has, however, been a significant increase in Australians merging their super into one account with more than 265,000 accounts with balances totalling $1.13 billion consolidated in the six months to December 2014.
“In one case, 17 accounts were consolidated,” he said.
“This is a rise of 400 per cent from the six months to December 2013 when 52,000 accounts worth more than $270 million were consolidated.”
Before consolidating, Mr Shepherd said individuals should look at the insurance cover they have with each fund, as it will be cancelled once they close their account.
“People should also make sure their super fund has their tax file number,” said Mr Shepherd.
“They’ll pay less tax on their super and it will help us to make sure all their super accounts are displayed online.”