Pensions – Call to save missing out on lost super

Pensions – Call to save missing out on lost super

Pensions – Call to save missing out on lost super

In a pre-budget submission Association of Superannuation Funds of Australia (ASFA) chief executive Martin Fahy called on the federal government to amend the Superannuation (Unclaimed and Lost Members) Act to enable the Australian Taxation Office (ATO) to return unclaimed funds directly to an individual’s current active superannuation account.

“One way to greatly improve the system is to have the ATO, which has the necessary capacity and identifying information, to return unclaimed funds currently captured by legislated threshold transfers,” Fahy said.

“The holding of Tax File Numbers and other identifying information in regard to most superannuation accounts makes it relatively easy for the Commissioner to match lost member account owners with their current active superannuation accounts.”

As of 31 December 2016, inactive super fund accounts over $6000 are transferred to the ATO to be held as unclaimed super, rather than being placed into a person’s active superannuation account.

ASFA estimates the ATO is currently holding an estimated $2.7 billons in consolidated revenue. Fahy contends the move to place the responsibility on the ATO would be welcomed by consumers, many of whom struggle with the complexity of super.

“There would be no Australian rejecting the return of their hard earned funds, particularly when consolidation into an active account could mean thousands extra in retirement,” Fahy said.

“Fund members with missing or lost accounts are more likely to generate earnings with their balance in a super fund, rather than with the ATO, where balances only attract interest at a current rate of 1.5%per year.”

ASFA said that it hopes the government would consider its submission and implement the changes into the upcoming May federal budget.

Taken from – ATO must reunite individuals with lost super: ASFA

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