19 Aug 2008

Employers must provide an employee’s TFN to their super fund when they have filled out a TFN declaration form for work purposes.

Your employees face signi.cant consequences if HESTA does not have their TFN. For example, their super may be taxed at an additional 31.5% and HESTA cannot accept personal after-tax contributions. This means eligible employees could also miss out on receiving the government co-contribution.

This is the first time HESTA members will notice these extra tax charges on their annual statements. If employers do not pass on their employees’ TFNs: 

• they may be guilty of an offence and liable to pay a penalty
• HESTA may have to deduct extra tax on the contributions, and
• the employee may miss out on a government co-contribution.

If you make employer contributions for an employee, you need to give HESTA their TFN within 14 days of receiving the employee’s TFN declaration form. But if you do not make a contribution for the employee during that period, you may pass the TFN on when you make the .rst contribution after receiving the TFN declaration.

While an employee is not obliged to provide you with their TFN, it is an offence for employers not to pass it on to their super fund within the required timeframe once it has been provided for superannuation purposes.
More information on employers’ TFN obligations are available at www.ato.gov.au/super

How members can start boosting their super now

While your employees may have missed the boat to receive a government co-contribution last .nancial year, now is a good time for them to start thinking about it again.  If a member qualifies, the Government will provide a co-contribution of up to $1.50 for every $1 of after-tax contributions.

The maximum annual co-contribution of $1,500 for a $1,000 after-tax contribution applies to incomes of $30,342 or less in the 2008/09 financial year. It is reduced for each dollar of income over $30,342, cutting out at $60,342. “Income” means assessable income and reportable fringe benefits.

Salary sacrifice contributions do not attract a co-contribution, although the Federal Government has indicated these types of contributions will be taken into account when assessing “income” for the purposes of the eligibility criteria used for determining the co-contribution.

If members do not have a lump sum to contribute to their super, they can start making small contributions early in the .nancial year to make it easier. For more information on the co-contribution call the ATO on 13 10 20 or visit www.ato.gov.au/super

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