WA Super News
Protecting Your Super (PYS) changes ahead
Over the years, we have been recommending that our members combine their multiple super accounts so they aren’t paying duplicate fees, or being charged for insurance they don’t need. While some members actively choose to have more than one super fund, often multiple accounts arise because people lose track of their super, which can result in account balances being eaten away by fees and insurance premiums.
This is the sentiment of the new Protecting Your Super (PYS) legislation, which comes into effect on 1 July 2019. This new legislation is designed to prevent insurance premiums and fees eroding super balances for those members with inactive or low-balance accounts.
The new legislation covers several changes including:
- changes to fees
- accounts transferring to the Australian Tax Office (ATO); and
- cancelling insurance for inactive members.
What are the changes?
1. Changes to fees
There are two changes to fees:
- exit and withdrawal fees will no longer be charged; and
- where an account balance is below $6,000, there will be a 3% cap on investment and administration fees.
2. Accounts transferring to the Australian Taxation Office (ATO)
If your account has been inactive for 16 consecutive months and has a balance of less than $6,000, it will be closed and transferred to the ATO on either 31 October or 30 April. The ATO will then conduct a search on your behalf to find other super funds in your name.
If the ATO finds another active super account that belongs to you, and the joint balance will be greater than $6,000, your money will be transferred to that Fund.
How to keep your WA Super account
It’s simple. If you don’t want your money to be sent to the ATO, all you need to do is ‘re-activate’ your WA Super account, by doing any of the following:
- make a personal contribution (via BPAY®) or have your employer contribute to your account
- roll money from other super accounts into WA Super using our Find and Combine service
- make a change to your insurance cover (if you have insurance)
- make an investment switch
- nominate or change a binding beneficiary to your account
- provide written notice to the ATO Commissioner
3. Cancelling insurance for inactive accounts
Another upcoming change relates to insurance. If you have insurance, but you haven’t added money to your super account for 16 consecutive months (in other words you are an inactive member) you could lose your insurance cover from 1 July 2019, unless you choose to opt-in.
How to keep your insurance cover
- opt-in to your insurance cover by completing an online insurance confirmation form,
- if you’ve already been notified by letter or email, you can return the form that was sent to you; or
- reactivate your account by:
If you are impacted by these changes, we have written to you to outline your options and provide you the date your insurance will be cancelled if choose to you do nothing.
If you need any further information, please contact us on 08 9480 3500 or if you want to make any changes to your existing insurance, please complete the Insurance application or variation form.