ATO warns on SMSFs’ SuperStream failings
Some SMSF trustees are still failing to complete the required steps for SuperStream, leaving five per cent of electronic service addresses (ESAs) inactive, according to the ATO.
ATO director of SMSF risks and products Nathan Burgess told SMSF Adviser that while 75 per cent of all SMSFs have now obtained an ESA and are ready to receive SuperStream contributions, approximately five per cent of all ESAs being used are not active.
“[SMSF trustees] think they’ve signed up, but they haven’t. They’re [either] quoting the wrong number or quoting the provider number for another fund they have, or they’re quoting the right provider but they just haven’t given them the details they need, which is the ABN of the super fund,” said Mr Burgess.
Some SMSF trustees obtain an ESA through an accountant or friend without realising they cannot use this ESA unless their fund is registered with the messaging provider, he added.
“Let’s say [the trustee] quotes Australia Post, who is a messaging provider, but they haven’t actually gone to Australia Post and said, well this is my ABN, and given Australia Post all the other details it needs,” he said.
“Then what happens is when the employer uses that number, or the clearing house on their behalf uses this number, they report back that it’s not active. It’s the right address in the sense that it is the provider but they don’t have the SMSF that is supposed to be linked to it.”
Mr Burgess also stressed that an email address is not a valid electronic service address.
“We’re starting to see people put an email address where the electronic service address should be, including the ATO’s,” he said.
The ATO is also seeing SMSF trustees incorrectly provide an email address for the Australian business register.
“This will cause them lots of problems down the track because eventually something is going to give and the clearance house or the employer is going to say, well this is not working for me and the whole point of SuperStream and this arrangement was to make life easier for businesses,” Mr Burgess said.
“If [businesses] don’t get the right information then they can go back to what is easy for them, which is their default fund, and we don’t want SMSFs to miss out on their contributions.”
Mr Burgess said the ATO has also been surprised at the low levels of SMSF trustees providing their electronic service address to the ATO for SMSF annual returns.
“It is optional but we expect people to actually provide it and we’re only getting about 25 per cent of people actually providing that to us,” he said.
“There are two things we are a little bit worried about there: one is that a lot less people have this set-up than we thought or people aren’t getting into the habit of using it, and it’s good to get into the habit of using it because eventually that will be the payment standard.”
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates. Miranda has also directed SMSF Adviser's print publication for several years.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.