Annual obligations and balance amounts

This protocol document provides guidance to superannuation (super) providers in meeting your annual reporting obligations as at 30 June of a financial year and where you choose to report a balance amount.

This reporting includes account balances, retirement phase values and accumulation phase values to be reported as at 30 June of a financial year. It also includes notional taxed contributions and defined benefit contributions, which are required to be reported for a financial year, as applicable.

Legislative context

Division 390 of Schedule 1 to the Taxation Administration Act 1953 (TAA) requires super providers to give statements to the Commissioner of Taxation in relation to member superannuation account transactions.

The Member Account Transaction Service (MATS) Legislative instrument Taxation Administration Member Account Transaction Service – the Reporting of Information Relating to Superannuation Account Transactions 2018 applies from 1 July 2018. It requires you to report member contributions balance amounts as at 30 June of a financial year on or before 31 October of that year. You can report member contributions balance amounts more frequently if you wish.

Member contribution balance amounts

Member contribution balance amounts include the:

• Account balance
• Accumulation phase value
• Retirement phase value
• Notional taxed contributions and defined benefit contributions

Account balance

You are required to report the 30 June balance of your member accounts no later than 31 October each year. You may choose to report member account balances more frequently. The account balance field of the annual MATS is mandatory and requires a value of zero or greater.

It is important to remember that our systems only consume the annual MATS you report with a 30 June balance date for other ATO calculations such as total super balance.

You are required to report an annual account balance for every super interest held as at 30 June, this may include where the interest is closed as at 30 June if you are reporting notional taxed and defined benefit contributions

Account-based accumulation interests

You are required to report a 30 June account balance for all open account-based super interests as at 30 June.

Your reporting will be correct if you use any reasonable method for determining the account balance that is appropriate in your circumstances. A reasonable method is one that provides your best estimate of the value of the member's interest on 30 June, based on the information available to you at the time you report.

The following are examples demonstrating broad principles and events that may influence the 30 June balance you report:

• investment manager announcements to the value of all member accounts as a result of investment distributions
• other routine adjustments to the value of all member accounts as a result of investment distributions.

Defined benefit and other non-account based interests

You are required to report an account balance equivalent to the balance reported to your member on their annual statement (or periodic statements). In some instances this may include a zero balance. You may be required to report an account balance where the interest is closed as at 30 June and you are reporting notional taxed and defined benefit contributions.

Zero account balance

The following examples provide circumstances where your reported account balance may be zero:

• an insurance-only policy where the only contributions made are used to pay premiums to an insurer (rather than being accumulated)
• an entitlement to a lifetime pension based only on years of service and final salary
• where no statements are issued to members
• when there is the obligation to report either a notional taxed contribution or a defined benefit contribution
• new accounts opened and no contributions received.

You cannot report negative balances. If your accounting systems record a negative balance, you need to ensure that your reporting systems report a zero balance to us.

 

 

Closed accounts

There is no obligation to report an account balance where the account has been closed during that financial year unless it was a defined benefit interest (or other non-account based interest) and you are required to report notional taxed or defined benefit contributions (or both) for that year.

Accumulation phase value

You are required to report an accumulation phase value (APV) when the account is in accumulation phase at 30 June and there is a difference between the account balance you have reported and the APV you have calculated (the APV is not limited to the sum of exit and administration fees).

The APV is the withdrawal value for an accumulation fund. That is the total amount of super benefits that would be payable if your member voluntarily ceased their super interest at that time.

The accumulation phase value also includes:

• certain deferred super income streams
• transition to retirement income streams that are not in retirement phase
• income streams that have not complied with the standards or a commutation authority.

For defined benefit interests the APV calculation is complex and we suggest you seek the appropriate guidance.

Retirement phase value

The retirement phase value (RPV) is required if there are all of the following:

• retirement phase interests covered by subsection 307-230(4) Income Tax Assessment Act 1997 (ITAA 1997)
• the account is in retirement phase at 30 June
• the reported account balance is not equal to the RPV.

See also:

• LCR 2016/12 Superannuation reform: total superannuation balance

Notional taxed contributions and defined benefit contributions

Annual amounts for defined benefits interest are referred to as:

• notional taxed contributions (NTCs) used to quantify concessional contributions for excess concessional contribution purposes
• defined benefit contributions (DBCs) used to quantify concessional contributions for Division 293 tax purposes.

Not all contributions made by an employer to a defined benefit interest are reported as employer contributions. Instead they may be included in the calculations of NTCs and DBCs. If you are reporting for a defined benefit interest ensure you report contributions at the correct field.

Compulsory member contributions made before-tax that fund a defined benefit.

Pre-tax compulsory contributions made for the purpose of funding a defined benefit interest and included in the actuarial calculation of NTC and DBC are not reported at any employer contribution field. This is where they have been included by the actuary in the calculation of the NTC or DBC.

Your members may be assessed incorrectly for excess concessional contributions and Division 293 tax if these amounts are reported in error.

Note: NTCs and DBCs are calculated differently. You should determine the amount of these contribution types for each member with the advice of an actuary and in accordance with the Income Tax Assessment Regulations 1997.

Reporting notional taxed and defined benefit contributions

Your obligations when reporting contributions for defined benefit interest, constitutionally protected funds (CPF) and public sector schemes are complex. Ensure your procedures and systems are based on sound professional advice.

NTC and DBC should be calculated as follows:

• if the member's interest ceases before 30 June, the amount is calculated immediately before the member's interest ceases (however you should report these amounts with a balance date of 30 June)
• in all other cases, the amounts are calculated as at 30 June.

You cannot report negative amounts at the DBC and NTC labels. If your accounting systems record a negative amount, ensure that you report a zero amount in this field.

Note. You are required to report a value at the account balance field.

Grandfathering of notional taxed contributions

You are required to complete the grandfathering indicator in the MAAS and report the fully calculated amount of NTC in your annual MATS. Our systems will consume the data from the MAAS and MATS to obtain the correct amount of contributions for the calculations.

See also:

• Grandfathering of notional taxed contributions

Reporting an account balance more frequently

In the interests of the member experience, you may choose to report a more frequent account balance in circumstances such as:

• when the account is opened, particularly in instances where an account has been closed and a new account opened early in a financial year
• to assist your member in working out their contribution caps where you are undertaking a successor fund transfer (SFT). When the successor fund opens the accounts, they will display on ATO Online without an account balance until the successor fund reports a balance. In some cases this may be up to 16 months. If you choose to report an account balance with a balance date other than 30 June, you will also need to report a 30 June balance on or before 31 October following the end of that financial year to meet your reporting obligations.
• when reporting for the purposes of displaying an updated account balance on ATO Online, do not reuse the last 30 June date as this amount with also be consumed for ATO calculations.

Reporting amendments

You must amend your reporting within 30 days of becoming aware of any material errors or omissions in the member contribution balance amounts you reported.

Use the 30 June annual balance date when correcting member contributions balance amounts. Failure to do this may have adverse outcomes for members, as the 30 June balance is the amount used for calculating certain member assessments and entitlements.

Note: When correcting your annual obligation you will need to complete the entire ‘Member contributions balance amount’ section again not just the label that you are changing. Failure to supply data at each of the relevant labels for your member will result in that label defaulting to ‘zero’.

If you are required to correct a transaction (such as an employer contribution) effective in a financial year and the 30 June account balance has already been reported, you must also submit a further member contribution balance amount MATS to adjust the 30 June account balance.

You are not required to report routine adjustments to the account balance (such as adjustments in the value of investments) that are made after the annual reporting is prepared for lodgment.

There are only two methods that should be used when correcting member contribution balance amounts:

• cancel the original transaction and re-report with corrected details
• overwrite the reported amount.

Cancelling the original transaction

When the original transaction has been cancelled it will not display on ATO online services. A new MATS form reporting the correct information must be submitted.

Our systems process each lodgment in a batch and across batch independently. We recommend that you wait for a response confirming that the cancel was successful prior to reporting the correct information for that account.

Scenario one – cancelling the original transaction

You lodge your member contribution balance amount transaction on 30 October 2020 with the following values:

Account balance	$15,000
Balance date	30/06/2020
Phase value amount	na
Phase type	na
NTC	$10,000
DBC	$10,000

You identify an error in the calculation of the members account balance on 11 November. You determine that this is a genuine error and to correct the reporting you will use the SPRMBRACCTX.Cancel interaction.

You use the SPRMBRCCTX.Submit MATS interaction to submit the correct member contribution balance amounts for the member on 12 November as follows:

Account balance	$150,000
Balance date	30/06/2020
Phase value amount	na
Phase type	na
NTC	$10,000
DBC	$10,000

Overwrite the reported amount

When you identify a material error or omission, you may choose to overwrite your annual reporting obligations. Transactions overwritten will only have the most recent values displayed on ATO Online.

Scenario two - overwriting the reported amount

You lodge your member contribution balance amount transaction on 30 October. Included in this report are values for the members NTC as at 30 June. On 5 November you identify an error in the calculation of the members NTC. You determine that this is a genuine error and to correct the reporting you will use the SPRMBRCCTX.Submit MATS interaction to overwrite transaction.

30 October original transaction EFG789	5 November amendment transaction HIJ789
Balance date: 30 June 2019	Balance date: 30 June 2019
Account balance: $0	Account balance: $0
Phase value amount:	na
Phase type code:	na
NTC: $30,000	NTC: $40,000
DBC:$40,000	DBC: $40,000

See also:

• MATS Business Implementation GuideExternal Link
• Member contributions statement protocol – for 2017–18 financial year and earlier

Guidance to superannuation providers in meeting your annual reporting obligations as at 30 June of a financial year and where you choose to report a balance amount.