Protecting Your Super
The Protecting Your Super (PYS) legislation was introduced by the Federal Government in response to the Royal Commission into Banking and Financial Services and came into effect on 1 July 2019.
The PYS legislation is intended to protect the super balances of all Australians and has altered the fees funds can charge, implemented the transfer of inactive low-balance accounts to the Australian Tax Office (ATO) and introduced cancellation of insurance for inactive members.
It’s important for you to be aware of these ongoing changes, as they may have a significant impact on your financial future.
What do these changes mean for you?
Reduction in fees
- Super funds will no longer charge exit fees
- There is now a 3% cap on both administration and investment fees for accounts with balances of less than $6,000.
Changes to insurance
If your Statewide Super account is;
- inactive for a continuous period of 16 months, and
- you do not elect in writing to hold insurance in your account;
then the insurance provided through your superannuation account must be cancelled. Your account will be considered ‘inactive’ if it has not received a contribution or rollover for a continuous 16 month period.
Inactive, low-balance accounts transferred to the Australian Tax Office
Statewide Super may be required to transfer the balance of your account to the Australian Tax Office (ATO) if it is classified as an ‘inactive low-balance account’. An ‘inactive low-balance account’ is a superannuation account which:
- has not received any contribution or rollover for a continuous period of 16 months; and
- has a balance of less than $6,000.
Statewide Super is required to identify inactive low-balance accounts on 30 June and 31 December each year and then report and pay them to the ATO by the ‘statement date’. For accounts identified on:
- 30 June, the statement date is 31 October of the same year
- 31 December, the statement date is 30 April of the following year.
The ATO considers that an account is not an inactive low-balance account if in the last 16 months a member has :
- changed their investment options
- made changes to their insurance coverage
- made or amended a binding beneficiary nomination
- made a written declaration that they are not a member having an inactive low-balance account.
For more information on inactive, low-balance accounts or ways to keep your account with Statewide Super visit the ATO website.
Frequently Asked Questions