What super stapling means for your business

When new employees start with your business on or after 1 November 2021, you may have an extra step to take to ensure your business is complying with choice of fund rules if they don’t choose a super fund.

You may need to request an employee’s stapled super fund details from the ATO.

What is super stapling?

A stapled super fund is as an existing super account which is linked, or ‘stapled’, to an individual employee so that it follows them as they change jobs.

The Federal Government has introduced super stapling with the aim of reducing account fees by stopping new super accounts being opened each time an employee starts a new job.

How does stapling affect employers?

Super stapling’s introduction means employers may now have an extra step to follow to meet their super responsibilities.

You may now need to request an employee’s stapled super fund details from the ATO when:

  • Your new employee starts with your business on or after 1 November 2021
  • You need to make super guarantee (SG) payments for that employee
  • Your employee is eligible to choose a super fund but doesn’t

You don’t need to offer a choice of super fund to some employees, but you may still need to request their stapled super fund details. This includes employees that are either:

  • Temporary residents
  • Covered by an enterprise agreement or workplace determination made before 1 January 2021

If you’re unsure whether the criteria relates to an employee in your business, you should contact the ATO on 13 10 20.

What you need to do

Here are the high-level steps of what you need to do from 1 November 2021. Full details are available on the ATO website.

  • Step 1 – Offer your eligible employees a choice of super fund

    You need to offer your eligible employees a choice of super fund and pay their employer contributions into the account they nominate. Most employees are eligible to choose what fund their contributions go into.

    Contractors can be treated as employees for SG purposes so you may need to pay them super. If you’re required to pay a contractor super but they don’t make a choice, you’ll have to request a stapled fund.

    There is no change to this step of your super obligations. If your employee has chosen a super fund, you can pay super contributions to the chosen fund.

  • Step 2 – Request stapled super fund details

    If an employee doesn’t choose a fund, you may need to get in touch with the ATO to request their stapled fund details. A tax practitioner may be able to do this on your behalf.

    You’ll be able to request an employee’s stapled fund after you’ve submitted a TFN declaration form or Single Touch Payroll pay event linking you to them. You can make an unlimited number of requests.

    Here’s how to request stapled fund details:

    1. Log into the ATO Online services for business
    2. Enter the employee’s details including their TFN, full name, date of birth and residential or postal address if their TFN isn’t provided
    3. ATO returns a stapled fund in response to the request

    You should be notified of the stapled fund result on-screen within minutes. The ATO will notify the employee of the stapled fund request and the fund’s details. They’ll also notify you of your request’s outcome if it was made by a representative.

    Bulk requests

    From 1 November 2021, ATO will make bulk request forms available for businesses requesting stapled fund details for 100 new employees or more at once.

    Be prepared with the following details:

    • Your business’ details, including its name, TFN and ABN
    • The employees’ details, including their TFN, full name, date of birth and address

    If a representative is making the request on your behalf, they’ll need their registered agent number and agent ABN.

    What if the stapled fund doesn’t accept contributions?

    If the stapled fund the ATO provides can’t accept contributions, you should make another request for the employee’s stapled fund, again through ATO Online services for business.

    If the request returns the same stapled fund, you should call the ATO on 13 10 20 to get an alternative stapled fund.

    If there’s no alternative fund, the ATO will advise whether contributions can be made to your business’ default fund or another fund that meets choice of fund rules.

  • Step 3 – Pay super into the stapled super fund

    If the ATO provides a stapled fund result for an employee, you must pay that employee’s SG to the stapled fund.

    You can pay employer contributions into your business’ default fund or another fund that meets choice of fund rules if:

    • The employee doesn’t choose a fund
    • The ATO has advised you that the employee doesn’t have a stapled fund

    Penalties may apply if you don’t meet your choice of fund obligations. Head to the ATO’s Super guarantee penalties page for more information.

What happens next?

We’ll keep you up to date if there are any changes to super stapling requirements for employers. Be sure to monitor the Employers section of our website for updates and follow us on LinkedIn.

We’re here to help

If you have questions about super stapling and what it means for you, our team is here to help. Call our dedicated Employer Helpline on 1800 640 886 with your business ABN and login email address on hand to get started, or contact your Business Development Manager.