You probably know by now that Choice of Fund legislation means that employees (with some exceptions) are able to choose their own fund.
Employers are required to nominate a default fund, which is where they pay employees’ Superannuation Guarantee (SG) contributions if they don’t make a choice.
If you’re choosing max Super as your default fund there are a few things you need to do to make sure you comply with Choice of Fund legislation:
1. Provide a Standard Choice Form
You need to provide an ATO Standard Choice Form to all employees who are a member of your current Employer Fund. This form explains that you’ll be making future payments into max Super, unless the employee wants to choose an alternative fund.
When to provide the Standard Choice Form to employees
- Existing employees: When you change your Employer Fund, you must provide one to all employees who are a member of the current Employer Fund, and on request from an employee. You only have to accept one Standard Choice Form from an employee in any 12-month period.
- New employees: You must give all new employees an ATO Standard Choice Form within 28 days of them starting work.
2. Make Superannuation Guarantee (SG) contributions
SG contributions must be made to the employer’s default fund or the employee’s chosen fund, if your employee nominates a choice on the Standard Choice Form.
Show me the cut off dates.
3. Keep and maintain records
It’s important that you maintain records that demonstrate you are complying with Choice of Fund legislation. To do this, you’ll need to keep records for five years that show the following:
- Eligible employees have been given a Standard Choice Form, including the dates these were issued and (any) returned to you
- Payment dates to show that a contribution has been made into an employee’s chosen fund within two months
- Standard Choice Forms or written requests from employees with relevant accompanying documentation.
For more information on Choice of Fund visit The ATO