Making employer super contributions to a fund whose assets have been frozen
If your default super fund or a super fund chosen by your employee has been identified by the Australian Prudential Regulation Authority (APRA) as a super fund that is not meeting its super fund obligations, APRA can make a direction to freeze the super fund’s assets. The Australian Securities and Investments Commission (ASIC) may also place a stop order on fund investments where it is concerned that product disclosure statements (PDSs) may be defective under the Corporations Act 2001.
If such an order or direction is made, the super fund will not be able to receive employer super contributions, or carry out any request from an employee to roll over funds or transfer amounts from an employee’s super account until the direction has been revoked by APRA or the order has been revoked by ASIC.
What does this mean for you?
You will need to make arrangements with, and pay the super contributions to, an alternative fund before the next super guarantee cut-off date (28 October, 28 January, 28 April or 28 July).
What if I am not able to make alternative arrangements by the cut-off date for super guarantee contributions?
If you are not able to make the cut-off date, you still need to pay your super guarantee contributions to an alternative fund, and you may be liable for the super guarantee charge. However, we will review cases where it is clear you have taken all reasonable steps to comply with your super obligations by the cut-off date.
What do I do if my employer default fund is affected?
If your employer default fund is subject to an APRA direction to freeze assets or an ASIC stop order, you will need to select a new default fund. You will also need to give your affected employees a new Standard choice form (NAT 13080) within 28 days of becoming aware of the APRA direction or ASIC stop order being made.
What do I do if my employee’s chosen fund is affected?
If your employee’s chosen fund is subject to an APRA direction to freeze assets or an ASIC stop order, you will need to send that employee’s super contributions to your existing default fund by the super guarantee cut-off date. You will also need to give your affected employee a new Standard choice form (NAT 13080) within 28 days becoming aware of the APRA direction or ASIC stop order being made.
What if I have already sent my super contribution to the affected fund?
If you have already sent your super contributions to the fund, cancel the cheque or electronic transfer and send your super contributions to an alternative fund by the super guarantee cut-off date. You still need to give your affected employees a new Standard choice form (NAT 13080) within 28 days becoming aware of the APRA direction or ASIC stop order being made.
