Superannuation Industry (Supervision) Amendment Regulations 2003 (No. 1) 2003 No. 42
EXPLANATORY STATEMENT
STATUTORY RULES 2003 No. 42
Issued by authority of the Minister for Revenue and Assistant Treasurer
Superannuation Industry (Supervision) Act 1993
Superannuation Industry (Supervision) Amendment Regulations 2003 (No. 1)
Section 353 of the Superannuation Industry (Supervision) Act 1993 (the Act) provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
Recent amendments to the Superannuation Industry (Supervision) Regulations 1994 (SIS Regulations) and the Retirement Savings Account Regulations 1997 gave effect to the Government's election commitment to allow temporary residents to access their superannuation benefits after they have permanently departed Australia. Since commencement of the measure on 1 July 2002 the implementation process has evolved and further amendments are required.
The SIS Regulations provide that where a member's withdrawal benefit is $5,000 or more, then the trustee of the fund must receive a written statement from the Department of Immigration and Multicultural and Indigenous Affairs (DIMIA) that the member was the holder of an eligible temporary residents visa that has expired or been cancelled and that the member has permanently departed Australia.
Where the member's benefit is less than $5,000, the trustee of the fund needs to receive a copy of a visa showing that the member was the holder of an eligible temporary resident visa that has expired or has been cancelled as well as a copy of the member's passport showing that the member has departed Australia.
An automated approach for temporary residents to apply for release of their benefits is being developed by the Australian Taxation Office (ATO) in conjunction with DIMIA. This will enable the temporary resident to apply electronically (through the ATO website) for certification that they are eligible to have their benefits paid. DIMIA will provide an electronic response to the ATO that will confirm or deny if the applicant held a relevant visa, and if they have departed Australia. It is intended that all temporary residents will have the option of using this electronic system. However, those currently with benefits less than $5,000 would not be able to use the system as the relevant regulations do not allow them the option of seeking DIMIA certification (rather they must provide copies of visas and passports to the fund).
The Regulations amend the SIS Regulations to allow temporary residents whose withdrawal benefit is less than $5,000 the option of providing the trustee of the superannuation fund a statement from DIMIA confirming their eligibility for release of their superannuation benefit. This will ensure that all temporary residents, irrespective of the size of their benefit will be able to use the electronic application system of certification rather than having to provide copies of visas or passports to the fund.
The Regulations also amend the SIS Regulations to confirm that New Zealand citizens are excluded from the measure. As stated in the explanatory statement to the original regulations that gave effect to the measure, it was not intended to provide access to superannuation benefits to those people who have the option of retiring in Australia and accessing the Age Pension, including New Zealand citizens. In certain limited circumstances it may have been possible for a New Zealand citizen to hold an eligible temporary resident visa. The amendment puts beyond doubt that New Zealand citizens are not eligible.
Details of the Regulations are set out in the Attachment.
The Regulations commence on gazettal.
ATTACHMENT
Superannuation Industry (Supervision) Amendment Regulations 2003 (No. 1)
Explanation of the amendments
Regulation 1 - Name of Regulations
This is a formal provision specifying the mode of citation of the regulations.
Regulation 2 - Commencement
The regulations will commence on gazettal.
Regulation 3 - Amendment of the Superannuation Industry (Supervision) Regulations 1994
The Superannuation Industry (Supervision) Regulations 1994 are amended as set out in Schedule 1.
SCHEDULE 1 - AMENDMENTS
Item 1 of Schedule 1 - amends Subregulation 6.01(2) to provide a new definition for an eligible temporary resident visa.
To be eligible for release of their benefit under the temporary resident measure, an individual has had to be in possession of an eligible temporary resident visa and that visa has expired or has been cancelled (whichever is applicable). Schedule 1AB of the regulations contain a list of the eligible temporary resident visa classes.
New Zealand citizens would not normally enter Australia on any of the visas listed, however, in certain limited circumstances it may be possible for them to do so. To put beyond doubt that New Zealand citizens are not eligible, the definition of eligible temporary resident visa is amended so that a visa held by a New Zealand citizen is not a eligible temporary resident visa.
Item 2 of Schedule 1 - amends Subregulation 6.20A(3) to allow temporary residents whose withdrawal benefit is less than $5,000 the option of providing the trustee of the fund a statement from Department of Immigration and Multicultural and Indigenous Affairs (DIMIA) confirming their eligibility. Regulation 6.20A applies to funds that are not unfunded public sector superannuation schemes.
Item 3 of Schedule 1 - inserts new Subregulation 6.20A(3A) which provides that the statement from DIMIA may be in electronic form.
Item 4 of Schedule 1 - amends Subregulation 6.20B(3) to allow temporary residents whose withdrawal benefit is less than $5,000 the option of providing the trustee of the fund a statement from DIMIA confirming their eligibility. Regulation 6.20B applies to funds that are unfunded public sector superannuation schemes.
Item 5 of Schedule 1 - inserts new Subregulation 6.20B(3A) which provides that the statement from DIMIA may be in electronic form.
Item 6 of Schedule 1 - amends Subregulation 6.24A(3) to allow temporary residents whose withdrawal benefit is less than $5,000 the option of providing the trustee of the fund a statement from DIMIA confirming their eligibility. Regulation 6.24A applies to approved deposit funds.
Item 7 of Schedule 1 - inserts new Subregulation 6.24A(3A) which provides that the statement from DIMIA may be in electronic form.