Superannuation reforms passed into legislation
The Protecting Your Super Bill passed through the Senate on Thursday last week. These new super rules became law on 18 February 2019.
These rules will apply from 1 July 2019, and will:
- cap super fees at three per cent per financial year for accounts with a balance $6,000 or less
- ban exit fees
- prevent default insurance being provided (and premiums deducted) for members with inactive super accounts
- require the transfer of inactive accounts (for example, those that have not received a contribution in 16 months or longer) with a balance below $6,000 to the ATO.
The Government had to negotiate with Parliament in order to get the legislation passed, resulting in a few changes from its original proposal in the 2018 Federal Budget.
As part of these negotiations, the Government agreed to remove legislation that would have ended default life insurance in superannuation for people under 25, or those with low-value or inactive accounts.
The Government intends to introduce a separate piece of legislation to deal with these insurance reforms.
Other amendments to the Bill include granting the ATO powers to reunite members with their lost or transferred superannuation within 28 days.
It is important for Intrust Super members to be aware that any insurance attached to their account will be cancelled if their account is transferred to the ATO.
Intrust Super will be contacting all members who are at risk of being transferred, where possible, so please keep an eye out for communications.
If you need further information or would like some direct assistance, Intrust Super is at your service. You can get in touch with your local Relationship Manager – their contact details are listed here.