The ATO is implementing a new standard for how employers communicate with superannuation funds. The aim is to simplify the process but is it really simpler?
Depending on the size of your business, from either 1 July 2014 or 1 July 2015, how you communication with superannuation funds to make contributions on behalf of your employees will be standardized.
Currently each fund has their own processes and procedures for supplying information and making payments. Under the new standard, all funds will be required to do this uniformly using the same electronic processes.
There is plenty of positives in this, particularly for larger businesses, but is it really going to simplify things for all? This could actually make things much harder for small business owners who have no or limited computer skills. It will also be harder for those who use manual record keeping systems. Businesses which aren’t using software which is compatible with the new standard will be forced to use an external service provider which may well mean added costs.
Businesses with less than 19 employees are eligible to use the Medicare Clearing House (a free electronic service provided by the government) but from our experience, a lot of people get really nervous about how much information they want to give the government about their affairs.
The new standard is certainly well intended and overall a positive initiative, but is it going to make doing business harder for smaller business owners?
More information can be found at http://www.ato.gov.au/Super/Data-standards/In-detail/Contributions/The-Data-and-Payment-Standard-simplifying-employer-contributions/