PSSap members working outside the public service now able to revert to government super scheme
There’s some fantastic news for those of you who may have previously been employed in the public service and are Public Sector Superannuation Accumulation Plan (PSSap) members.
As a PSSap member (this includes existing preserved members), you will soon be able to revert to the PSSap scheme, even if you have left the Australian Public Service.
Many of our contractors at Bookssorted have held a position previously in the public service, but upon becoming a contractor had to find a new super fund for their superannuation payments.
This has been a bug bear for many contractors over time and weighs heavily on the minds of many who want to change jobs, but also want the security of the PSSap scheme.
The legislative changes required to allow PSSap members who have left the Australian Public Service to continue to contribute to PSSap has been passed by the House of Representatives. And while this still needs to be approved by the Senate the Australian Government is updating its systems and processes to facilitate the changes once they are approved.
The Commonwealth Superannuation Corporation (CSC) will update members when they can begin taking advantage of these enhancements.
The CSC has advised that, in the meantime, it’s important to keep your contact details up to date so they can inform members of any future developments. You can check and update your contact details via Member Services Online.
This new change to the PSSap scheme is welcome news
It gives members the flexibility to build for retirement while avoiding multiple superannuation accounts, which often leads to lost or forgotten superannuation.
The Australian Government has also advised that PSSap members will be able to maintain the advantages of CSC’s 10 year platinum-rated ‘best value for money’ superannuation offering within the government superannuation environment.
For those of you who are PSSap members and wish to revert to this scheme for your super, the process will be very simple. There is a great video on the Commonwealth Superannuation Corporation website. This step by step guide explains how to revert your super payments. The process is as simple as logging into Member Services Online, then using the online from to nominate PSSap as your current super fund—the CSC does the rest of the work!
As advised by the CSC, keeping your PSSap membership means:
- the ability to elect PSSap as your ‘Choice of Fund’ to continue to receive employer super guarantee (SG) contributions from your non-public service employer
- continued access to CSC’s investment expertise—CSC’s investment team is highly regarded in Australia and globally for its stewardship of an integrated approach to investment risk management
- the ability to continue to access PSSap’s exclusive lifePLUScover designed exclusively for PSSap members including a 15.4% super contribution via the income protection benefit (well above most other competitor superannuation funds), and
- access to CSC’s well regarded products and services such as Education, free single issue and fee for service financial advice with no hidden commissions.
Remember the superannuation cap
In addition to this great news, it’s a timely reminder that as of 1 July last year a new superannuation cap was introduced. Concessional Contributions (before-tax contributions) are now capped at $25,000.
Many contractors who salary sacrifice superannuation contributions previously had an annual cap of cap of $30,000 (if under 50 years of age on 30 June 2017), or $35,000 (if 50 years of age, or over, on 30 June 2017).
From 1 July 2017, the cap was reduced to $25,000, regardless of age. This means the threshold is reached much sooner.
It’s extremely worthwhile, as we approach the final quarter of the financial year, to review your salary sacrificed contributions, to ensure you don’t go over the cap. Don’t forget this also includes your Super Guarantee—the minimum amount you (or your employer) must pay into your superannuation.
For more information read our blog What does the new superannuation cap mean for you?
Need some help?
If you need assistance or advice on any aspect of your superannuation, please feel free to contact a member of the Bookssorted payroll services team contact@bookssorted.com.au or call 02 6161 8580, they will be happy to help.