Welcome to the latest issue of the KHQ Super Alert. This week, the ASIC supervisory cost recovery levy instruments were registered, AFCA released draft guidance relating to complaints involving financial advisers and managed investment schemes and the ATO provided an update on its development of guidance for superannuation issues.
Parliament – Bill to implement electronic execution of statutory declarations passed
On 9 November 2023, the Statutory Declarations Amendment Bill 2023 passed both Houses of Parliament and now awaits Royal Assent. As mentioned in our Super Alert from 15 September 2023, this Bill establishes a framework for the electronic execution of Commonwealth statutory declarations.
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Legislation – ASIC supervisory cost recovery levy
On 7 November 2023, the ASIC (Supervisory Cost Recovery Levy—Annual Determination) Instrument 2023/778 and ASIC (Supervisory Cost Recovery Levy—Regulatory Costs) Instrument 2023/777 were registered on the Federal Register of Legislation. The two instruments specify:
- ‘ASIC’s regulatory costs and their attribution to each industry sub-sector for the 2022-23 financial year’; and
- ‘certain matters about [the] size and composition of ASIC’s regulated population and of the metrics that apply to each industry sub-sector within that regulated population for the 2022-23 financial year’.
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ASIC – Proposed extension to s29QC relief
On 6 November 2023, ASIC issued a media release advising that it is proposing to extend the relief currently provided in ASIC Class Order CO 14/541. Under this Class Order, trustees are exempt from the requirement in section 29QC of the Superannuation Industry (Supervision) Act 1993 to ensure ‘that information given to the public (e.g. in disclosure documents) [is] calculated in the same way that the information is reported to the Australian Prudential Regulation Authority’. The relief is due to expire on 1 January 2024 but ASIC proposes to extend the relief until 1 January 2026.
The consultation period closes on 4 December 2023.
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AFCA – Consultation for approach to complaints involving financial advisers and managed investment schemes
On 6 November 2023, AFCA released a draft document titled ‘The AFCA Approach to determining compensation in complaints involving Financial Advisers and Managed Investment Schemes’.
AFCA is seeking feedback in relation to how it:
- will ‘assist financial firms and complainants to understand how [AFCA considers] these complaints’;
- ‘will consider liability and compensation in relation to financial advice firms and Responsible Entities’;
- ‘will have regard to [legal principles] in determining compensation’;
- ‘applies fairness to these situations’;
- will ensure the approach ‘is consistent with applicable legal principles, regulatory guidance, good industry practice and codes of practice’; and
- can ‘ensure consistent application and understanding of [AFCA’s] approach to these matters’.
The consultation period closes on 1 December 2023.
Click here for details.
ATO – Super guarantee employer compliance results
On 6 November 2023, the ATO released the annual employer compliance results in relation to the payment of the superannuation guarantee (SG). Some highlights from the 2022-23 financial year include:
- that ‘[e]mployers are paying more than 94% of the SG amount they are required to, without intervention from the [ATO]’; and
- ‘[t]he ATO distributed $387 million of super entitlements into the super funds of 737,000 employees. This includes SG amounts collected for liabilities raised arising from employee complaints, ATO initiated compliance activities and employer voluntary disclosures’.
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ATO – Update on superannuation advice and guidance under development
On 5 November 2023, the ATO provided an update on its Advice under development – superannuation issues program. According to the ATO, there are four superannuation-related issues for which the ATO is developing advice or guidance:
- updating Taxation Ruling 2013/5 Income tax: when a superannuation income stream commences and ceases – no timeline provided (see our Super Alert from 28 September 2023 for more details);
- reviewing three Superannuation Guarantee Rulings (SGR 2005/1, SGR 2005/2 and SGR 2009/1), two Taxation Rulings (TR 2005/16W and 2013/1) and one ATO Interpretive Decision (ATO ID 2014/28) ‘to reflect the direction provided in the High Court decision in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd[2022] HCA 1’ in relation to the ordinary meaning of the term ‘employee’ – expected late 2023;
- issuing a final taxation determination related to ‘determining the amount of statutory income that is non-arm’s length income’ – expected December 2023 (see our Super Alert from 7 July 2023 for more details); and
- issuing a draft taxation determination in relation to the ‘deductibility of expenses incurred by a superannuation fund in establishing and maintaining a trustee risk reserve’ – expected December 2023.
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This alert was written by Kiara Leslie (Lawyer), Sanela Osmanovic (Senior Associate), and Natalie Cambrell (Director).
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