What is Stapling and why is it being introduced?
Stapling is an Australian Government superannuation reform that will be introduced from 1 November 2021 and applies to new employees (it cannot be used for existing employees).
Aimed at avoiding the creation of multiple unintended super accounts that are eroded away with fees and charges, the ATO will have a record of every employee's eligible super fund and these details are "stapled" to the employee.
What is it replacing?
Currently if an employee does not provide super fund details or they are incorrect, an employer must pay eligible super contributions into the employer's nominated default fund. From 1st November 2021, this will no longer be the case.
What does stapling means for employers?
Under the new reform, an employer MUST contact the ATO and obtain the details of the new employee's stapled fund if the employee does not provide you with their super details or nominate a choice fund.
You will be able to request your employee's stapled super fund after you have lodged a Tax File Number (TFN) declaration or a Single Touch Payroll (STP) pay event for the employee.
How can an employer obtain the stapled fund details?
- Log into ATO online service (For Business)
- Request Stapled fund and enter employee details
You will receive a response on-screen within minutes. The ATO will notify your employee of the request and the fund details provided to you. The ATO will also be monitoring this service to ensure employers are using it appropriately and are making genuine requests.
Stay tuned for updates that are sure to come as the ATO refine the process!