New approach for temp residents’ super
Nick Sherry
The Federal Government has substantially reversed its approach to temporary residents’ superannuation.
The Minister for Superannuation and Corporate Law, Nick Sherry, announced the changes at the Investment and Financial Services Association national conference today.
He said that under the new approach, temporary residents’ superannuation would remain growing in the superannuation fund for the entire time the person is residing in Australia.
Sherry said this meant employers would be able to pay temporary residents super in the same manner as other employees.
The changes are also expected to deliver a significant reduction in compliance costs for the industry and will allow for insurance cover of temporary residents, as they will continue to be fund members while they reside in Australia.
“We’ve carefully listened to both industry and community feedback during the public consultation process and, as a result, we’ve decided to significantly modify the administration of the temporary residents superannuation policy,” Sherry said.
“This new administrative approach produces a fairer outcome for temporary residents as their superannuation will remain in their fund while they are in Australia, rather than being swept out annually, and they will continue to be able to take their superannuation with them when they depart,” he said.
The Government will use the existing unclaimed superannuation arrangements to transfer the account balance of temporary residents six months after they depart Australia and no longer hold a visa, if the person has not claimed their super on departure.
“Departed temporary residents will also be able to claim back, at any time, any superannuation that has been paid to the Commonwealth,” Sherry added.
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