When we must make a refund
The Superannuation (Unclaimed Money and Lost Members) Act 1999 (SUMLMA) states that where the Commissioner is satisfied that an amount paid by a reporting fund exceeded the amount payable (if any) under the relevant subsection with respect to an individual, the Commissioner must refund the excess to the reporting fund. If the reporting fund no longer exists, the Commissioner must refund the excess to an equivalent fund.
The Commissioner will be satisfied that an amount paid exceeded the amount (if any) that was payable under the relevant subsection, once the Commissioner has processed an adjusted USM statement and this results in a material decrease in the amount payable with respect to a person.
When to lodge USM adjustments
You have 30 days from when you find a mistake or omission on your reported USM statement to lodge an adjustment. You can request a deferral for your USM adjustment if you can't meet this deadline. Interest and penalties may apply. To help minimise these you should lodge as soon as possible.
The adjustment request should be because of a genuine fund reporting error, not a change of mind by fund or member. When processing an adjustment request, we may seek evidence to support your request.
For example, you can request an adjustment if you:
- incorrectly reported an amount
- forgot to include a member
- incorrectly reported a member.
Making a reasonable adjustment request
The following are some examples of:
Valid adjustment requests
Example: incorrect member's account
Member Sarah Black with DOB 17/02/1946 is identified as a member who has reached eligibility age (generally 65 years old) and the trustee has lost contact with her.
The account for a different member, Sarah Black with date of birth 03/10/1976, is reported and paid to the ATO in error.
The super provider becomes aware of the reporting error and requests an adjustment as soon as possible to have the incorrect lodgment for the member cancelled and the payment refunded.
End of example
Example: system issue needing a full adjustment
A lodgment is made for 417 members that have been identified as meeting the unclaimed money criteria.
The super provider identifies that due to a system error only 400 members should have been reported and payment was made for the 400 members.
The super provider must lodge an adjustment template to request a cancellation of the entire lodgment. The super provider then re-reports for only the correct members using the same payment reference number (PRN) as the payment.
End of example
Example: system issue needing a partial adjustment
A lodgment is received for 32 members that have been identified as meeting the unclaimed money criteria. A matching payment is received for the lodgment.
The super provider identifies that 2 of the members have been reported incorrectly due to a technical system error.
The super provider lodges a partial adjustment template to request a cancellation of the 2 incorrectly reported members. The ATO cancels the lodgment for the 2 identified members and issues a refund to the super provider.
End of example
Example: claim by beneficiary in progress
The super provider was processing a claim by the beneficiary for the deceased member’s interest.
In the meantime, the money was picked up in error through the funds automatic processing and paid to the ATO as deceased USM.
The super provider lodges an adjustment template to request a cancellation of the incorrectly reported member. The ATO cancels the lodgment for the identified member and issues a refund to the super provider.
End of exampleInvalid adjustment requests
You can't make an adjustment if a member is correctly identified as unclaimed and the member later makes contact.
Example: adjustment not required
A super provider identifies member Simon Kent as a member who has turned 65 years old and, after reasonable attempts, has not been able to contact him.
The super provider reports and pays Simon's account to the ATO in October 2020 in accordance with the law. In December 2020, Mr Kent contacts the super provider after receiving delayed mail that had been forwarded to a new address.
In this instance the amount was not reported in error and an adjustment is not valid. Simon's account was correctly identified as unclaimed at the time the unclaimed money was reported and paid to the ATO.
The member should be directed to ATO Online Services where they may then request a direct payment of unclaimed money if eligible or may opt to rollover any ATO-held super to their chosen fund destination.
End of example
Example: member declaration form received after lodgment
A super provider has reported and paid USM as per their reporting obligations. The member then sends a declaration form declaring they are not a member of an inactive low-balance account.
If, at the time the reporting and payment was completed by the fund, the declaration had not been received by the super provider; then the account was correctly reported and paid as an inactive low-balance account.
The fund should explain to the member that the reporting and payment has already concluded, and their account has been sent to the ATO in accordance with legislative requirements.
If account has not already been proactively consolidated to an active account of the member, the member should be directed to ATO Online Services where they may then request a direct payment of unclaimed money if eligible or may opt to rollover any ATO-held super to their chosen fund destination.
End of example
Example: member makes contact after a valid USM lodgment
A super provider determines their USM on the unclaimed money day, and reports and pays by the scheduled statement day. Six months after the money has been transferred to the ATO, the member contacts the fund claiming financial hardship. The account has been reported correctly and there is no valid reason for the money to be returned.
If account has not already been proactively consolidated to an active account of the member, the member should be directed to ATO Online services where they may then request a direct payment of unclaimed money if eligible or may opt to rollover any ATO-held super to their chosen fund destination.
End of example
Example: member wants to access insurance
A super provider accurately reported and paid a member's USM to the ATO. Four months later the member contacts the fund to gain access to their insurance. As this is not a reporting error it is not required to be returned to the fund.
The fund should explain to the member that the reporting and payment has already concluded and their account has been sent to the ATO in accordance with legislative requirements.
End of exampleHow to lodge USM adjustments
For all USM adjustment requests, you will need to download the USM adjustment template (XLSX 45KB)This link will download a file.
Increase adjustments
If your adjustment involves an increased USM amount, report this to us by sending a new USM lodgment for the additional amount via SuperStream.
Decrease adjustments
If your adjustment involves a decreased USM amount for a member a partial adjustment request will need to be lodged. We will cancel the lodgement and you can then send a new USM lodgment to report the correct entitlement for the member via SuperStream.
Ensure the USM adjustment template is completed as per the data specifications and complete and accurate information is provided. Failure to do so may require you to resubmit a corrected template.
How to lodge your template
Lodge your completed USM adjustment template through Super Enquiry Service or Online services for business.
Super Enquiry Service
To lodge your template through the Super Enquiry Service:
- Select Fund enquiries, then USM reporting
- For the request type, select USM – adjustments
- Complete the required information
- Attach your file, then submit.
Online services for business
To lodge your template through Online services for business:
- Select Communication, Secure mail, then New
- Select Superannuation as topic
- Select Lodge USM adjustment templates / Non-lodgment advice
- Attach your file, then complete the declaration and send.
Why we can't automatically refund USM
Lodging and paying your USM to us is a tax obligation under section 17(1) of the Superannuation (Unclaimed Money and Lost Members) Act 1999 (SUMLMA).
Under section 17(1) of SUMLMA, the obligation to pay USM to the ATO is a tax-related liability. This means that any payment received in respect of a current or anticipated debt must be allocated in accordance with our legislation and can't be automatically refunded.
The reporting and payment of USM occurs in accordance with the SuperStream rollover standard, however the associated obligations are contained in the SUMLMA.
The obligations to report and pay USM are 2 separate obligations and if a message is rejected the obligation to pay still stands.
If the reporting period relating to the adjustment request is not balanced to zero or the fund is still lodging and paying, we are unable to refund as there are current reporting obligations to be met.
Where an adjustment request is granted, we will process the refund and provide you with the refund details via the same channel the adjustment was requested.
Requesting a deferral for your USM adjustment
It is in the best interest of members and funds to ensure the original lodgment is accurate. If necessary, request a deferral of your member reporting obligation to ensure the information you submit to us is accurate and complete.
We have discretion to grant a deferral of your reporting obligations if it is fair and reasonable to do so. This includes a deferral of the time to advise of a material change to, or omission in, information you have already given to us.
Lodgment deferrals extend the due date for lodgment of a document, giving additional time to lodge without incurring a failure to lodge on time (FTL) penalty.
Show reasonable care
You have a responsibility to submit accurate and complete USM reporting. You should ensure that you have appropriate processes in place to meet your legislative obligations. Your assessment of whether an account meets the appropriate definitions under the Superannuation (Unclaimed Money and Lost Members) Act 1999 should be complete at the time of lodging your statement.
Where adjustments are later lodged, we will review them to check if they are the result of a lack of reasonable care. If they are, we may consider penalties for false and misleading statements.