Stapling

With the new stapling rule on our doorstep, here are the ins and outs explaining what it is and how you can stay compliant.

What is stapling?

From 1 November 2021, when an employee changes jobs, their super account will follow (or be ‘stapled’ to) them. It’s one way the Australian Government is trying to prevent multiple super accounts.

So, if a new employee doesn’t specify where they want their super paid when they start a new job, you will need to find out what their stapled fund is via the Australian Taxation Office (ATO).

If an employee has more multiple funds that can be used, the ATO will use a set of tie-breaker rules to work out their stapled fund. If they don’t have a stapled super fund and don’t choose one, you’ll need to open a default super account for them, which will then probably become their stapled fund.
 

How does it work?

From 1 November 2021, when a new employee starts work, you will have an extra step to consider when determining where you need to pay their super contributions:

• If a new employee provides you with a choice of fund election, you will generally need to pay their super contributions to their chosen fund¹. A new employee may choose to join your employer super fund, in which case you can open a super account for them using SuperStream.
• If you don’t receive a choice of fund election form, you will need to check with the ATO whether they have a stapled fund to contribute to instead².
• If there is no stapled fund and no choice of fund election, you’ll need to pay the employee’s super contributions to your default fund, or the fund named in your employee’s Industrial Award, Enterprise Bargaining Agreement (EBA) or Collective Bargaining Agreement (CBA).

New employees should consider what’s right for them and make an informed decision about their super. While employers can’t provide recommendations or advice about super to their employees (unless they’re licensed to provide financial advice), information about the key benefits of AMP Super is available via our induction page, where they can learn more. Employees can also use our one-on-one session with a super coach to help answer questions.

How to request a stapled fund from the ATO

We can’t provide stapled fund details, it must come from the ATO. Here’s how the process works:

1. First, you need to make sure you’re ready by checking you have the right access to the ATO online services.
2. Then, to request a stapled super fund, you’ll need to:
        a. log into ATO online services.
        b. enter your employee's details, including their tax file number, name, date of birth and address (only required if TFN is not provided).
3. The results will appear on-screen within minutes.
4. The ATO will let your employee know about the stapled super fund request and the fund details they have provided.

An authorised intermediary can request stapled fund details on behalf of an employer. Where the details are requested by an authorised representative, the employer will be notified of the outcome of the request

You can find further information, including how to make sure you have the right access from the ATO website.

Need a hand?

If you have any questions call us on 131 267 or contact your account manager.

¹ Provided an employee is eligible to choose their own fund and all required information is included in the choice of fund election, the choice nomination can only be rejected if an employee has nominated a fund in the previous 12 months; however, the employer may still choose to action the request.

² Employers will need to determine how long they can wait for a choice of fund election to be provided before requesting a stapled fund notice, depending on their contribution cycle and the length of time available before the next SG cut-off date.