ATO wants to give away billions

It’s that time of the year again – when the Australian Tax Office (ATO) almost turns Father Christmas.

It holds more than $3.75 billion in unclaimed superannuation and has embarked on an annual  email and advertising campaign to try to reunite the owners with their lost funds.

Rosemary was recently reunited with $6000 in super funds that she didn’t know existed, proving the inquiry process can work well.

The ATO holds unclaimed super for about 5.38 million accounts, while Australian super funds hold another $14.12 billion in lost super.

If you earn or have earned more than $450 a month, you’re generally eligible for super paid by the employer under the Superannuation Guarantee policy that was introduced in 1992.

If an employee did not nominate a fund, the contributions are paid into a default fund and the employee may have been totally unaware of its existence.

Anyone who thinks they may have lost super should visit the ATO website and follow the instructions.

A super account is deemed lost if the owner cannot be contacted for a period of 12 months.

The Government uses ‘lost’ super accounts with balances of less than $6000, labelling the cash as revenue until it is claimed by its rightful owner. While the money doesn’t accrue investment returns, it does rise at the rate of inflation.

The threshold for lost super accounts increased from $2000 in 2012, to $4000 and then to $6000 on 1 January 2017.

If you find lost super, it could have implications for any Age Pension payments.

Your super is assessed as an asset if you have not yet commenced an income stream.

If you choose to commence an income stream with any newfound super, then it will be assessed under the income and asset test to determine how any pension payment may be affected.

If it is withdrawn as a lump sum, what you do with the money will have an impact on how it is assessed. As a one-off lump sum, it won’t be counted as income. However, if you choose to purchase a financial asset, such as shares, or place it in an interest-bearing account, then deeming rates will be applied and it will be assessed under the income and asset test.

Have you ever searched for unclaimed super? Was there a happy ending to the hunt?

Related articles:
How Centrelink assesses super
Explaining super
Lost super legislation

Written by Janelle Ward

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