Understanding financial advice
Financial life goals
Tools and resources
Products and services
Investing with IOOF
Your retirement goals
By Julie Steed, Senior Technical Services Manager
From 1 October 2021 rollovers to and from SMSFs will only be able to be processed via SuperStream.
SuperStream is the electronic system used to transfer money and data to super funds. SuperStream is used to process employer contributions to APRA regulated funds and for rollovers between super funds. It can also be used for certain ATO release authorities.
The move to include SMSFs in SuperStream rollovers is welcomed by many SMSF practitioners who have experienced delays in receiving rollovers to SMSFs. The SuperStream protocols require paying funds to process the rollover of a member's benefit electronically and within three days of receiving a valid request.
Many practitioners have mature SMSF clients who are not anticipating receiving any further rollovers so they have paid little attention to the SuperStream requirements. However, if clients decide to wind up their SMSF and rollover to a retail fund, they will generally need to register for SuperStream before the SMSF can process the rollover. SuperStream can be activated at any time.
In-specie rollovers are not covered by SuperStream and may continue to experience delays.
Members may initiate a rollover via their MyGov account or by requesting the rollover from the paying fund.
ASIC's requirement for an SMSF's investment strategy to consider an exit strategy may require trustees to consider SuperStream as part of their next regular investment strategy review.
Most professional administrators are SuperStream ready and many already process rollovers this way. Where an SMSF doesn't use professional administration services they will need the following:
The fund that is paying a rollover is also required to use the ATO's electronic services to verify the SMSF and member details. Details include that:
The process should reduce delays in verifying the bone fides of the receiving SMSF - if the ATO is happy, the paying fund should be happy!
The ATO has been active in identifying SMSFs where the fund is not recorded as holding a unique bank account. If an SMSF changes bank account details, the fund will need to advise the ATO of the updated account details.
The paying fund has three days from receiving an actionable rollover request to process the payment. If the rollover request has incomplete information, the trustee of the paying fund must request the required information within three days. Additional time may be allowed if the paying fund needs to sell down assets.
Whilst the prompt receipt of rollovers into SMSFs is welcomed, there may be many practical reasons why an SMSF is not able to action a request to rollover to another fund within the three day timeframe. In the absence of professional administration, it is not always possible to accurately calculate a member's entitlement with three days. In addition, the sale of assets to make the cash payment may take longer than three days.
Where one member is leaving because of a dispute with another member, further difficulties in meeting the required timeframes may occur.
Another requirement of the SuperStream system is that the trustee of the receiving fund must allocate the rollover to the member's account within three days of receipt of the funds. For SMSFs without professional administration a minute regarding the allocation may be required.
SMSFs expecting to receive member benefits rolled over from another fund will need to ensure they are registered for SuperStream prior to the member requesting the rollover. Likewise, registration will be required before an SMSF trustee can rollover a member benefit to another fund.
If you have any questions, or would like more information, please contact the IOOF TechConnect team on 1300 650 414.
The information in this section of the website is intended for financial advisers only and is not to be distributed to clients. It has been prepared on behalf of Australian Executor Trustees Limited ABN 84 007 869 794 AFSL 240023, IOOF Investment Management Limited ABN 53 006 695 021 AFSL 230524, IOOF Investment Services Ltd ABN 80 007 350 405, AFSL 230703 and IOOF Ltd ABN 21 087 649 625 AFSL 230522 based on information that is believed to be accurate and reliable at the time of publication.