AMP Retirement Savings Account
Product Disclosure Statement
Contents
1. About AMP Retirement Savings Account 2. How super works
3. Benefits of investing with AMP Retirement Savings Account
4. Risks of super
5. How we invest your money 6. Fees and costs
7. How super is taxed 8. How to open an account 9. Other information
This Product Disclosure Statement (PDS) is a summary of significant information and contains a number of references to important information in a Fact Sheet (which forms part of this PDS). You should consider that information before making a decision about AMP Retirement Savings Account.
Information in the PDS may change from time to time. We may update information which is not materially adverse to you on amp.com.au/pdsupdates. The information can also be obtained (at no charge) by calling us on 131 267 or from your financial planner.
The information provided in this PDS is general information only and does not take account of your personal financial situation or needs. You should obtain financial advice tailored to your personal circumstances.
1. About AMP Retirement Savings Account
AMP Retirement Savings Account (”RSA”) is a superannuation account open to new employees of existing employer sponsors.
AMP Retirement Savings Account is capital guaranteed so that your crediting rate cannot be negative.
You should read the important information about Information on your account before making a decision.
Go to the Fact Sheet available at www.amp.com.au/rsa.
The material relating to Information on your account may change between the time you read this PDS and the day when you acquire the product.
AMP Retirement Savings Account is part of a superannuation fund known as the AMP Superannuation Savings Trust (the fund). AMP Superannuation Limited is the trustee of the fund and is referred to as “we” or “our” in this PDS.
2. How super works
Super is a long-term investment and a tax-effective way of saving for your retirement. Putting in place a suitable super strategy can increase the likelihood of you doing what you want to do when you retire.
In most cases, your employer is required to contribute to a super fund for you. And subject to the terms of your employment, you are usually able to choose which super fund you would like your employer to make its compulsory employer contributions to.
Boosting your super savings
There are many types of contributions that can be made to your super. These include:
– Making salary sacrifice contributions.
– Making additional personal contributions.
– Taking advantage of the Government co-contribution.
– Arranging spouse contributions to be made into your account.
Issued 21 June 2012
Issued by AMP Superannuation Limited ABN 31 008 414 104, AFSL No. 233060, the trustee of the AMP Superannuation Savings Trust ABN 76 514 770 399.
NS8076 06/12
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You may also help build up your super savings in your AMP Retirement Savings Account more quickly by:
– Consolidating your super into the one account.
– Finding your lost super.
Limits on contributions
There are limits on the contributions that can be made into your AMP Retirement Savings Account, depending on your age, how many hours you are working and other factors.
The Government also has set dollar limits (or caps) on the amount of contributions that can be made to your super each year before additional tax becomes payable. See How super is taxed on page 5.
Accessing your super
Because super enjoys tax advantages, the law restricts when you can access your super money. These restrictions are known as “preservation rules”.
Generally this means that you can only access your money after you reach your “preservation age” (between ages 55 and 60, depending on your date of birth) and retire (with some exceptions) or in certain other circumstances. Once you have satisfied the “preservation rules”, you can start withdrawing from your super account or access your super in the form of an account based pension (see Benefits of Investing with
AMP Retirement Savings Account below).
Temporary residents of Australia: If you are a non-resident who has permanently left Australia and not withdrawn your superannuation benefit within 6 months of your temporary visa expiring, we may be required to pay your benefit to the Australian Taxation Office (ATO), after which you will need to apply to the ATO to claim your superannuation.
You should read the important information about Types of contributions, Contributions caps and the excess contributions taxes and Money out (Accessing your money) before making a decision. Go to the Fact Sheet available at www.amp.com.au/rsa. The material relating to Types of contributions, Contributions caps and the excess
contributions taxes and Money out (Accessing your money) may change between the time you read this PDS and the day when you acquire the product.
3. Benefits of investing with AMP Retirement Savings Account
The AMP Retirement Savings Account has the following benefits:
Security for your super
RSA is capital guaranteed so that your crediting rate in RSA cannot be negative. AMP Life’s No.1 Fund that has assets in excess of $25 billion as at 31 December 2011 provides this guarantee.
As there are no administration fees charged directly to your account, this means that for as long as it stays in RSA, your account balance cannot reduce due to administration fees.
Beneficiary nomination options and paying your Death benefit
You can provide the Trustee with your preferences on who you want your benefit paid to in the event of your death. You have a choice of:
Option 1 - Non-binding (or preferred) nomination.
Option 2 - No nomination.
You should read the important information about Paying your Death benefit before making a decision. Go to the Fact Sheet available at www.amp.com.au/rsa. The material relating to Paying your Death benefit may change between the time you read this PDS and the day when you acquire the product.
Access to your super
Once you satisfy the “preservation rules” you can make partial withdrawals from your super, withdraw your super as a lump sum or, you can access your super in the form of an account- based pension.
Easy to deal with
AMP Retirement Savings Account puts you in control of your super. You can:
– View and manage your account online through My Portfolio at any time.
– Keep your super in one place with our Super Consolidation Service (at no additional cost to you).
You should read the important information about Consolidating your super and My Portfolio before making a decision. Go to the Fact Sheet available at
www.amp.com.au/rsa. The material relating to consolidating your super and My Portfolio may change between the time you read this PDS and the day when you acquire the product.
4. Risks of super
All investing involves some risk – it’s the trade-off for the returns we all want to earn. The key risk with investing in super is “investment risk”, but there are also other significant risks you need to consider.
Investment risk
Investment risk means the value of investments and returns are likely to vary. Future returns may differ from past returns.
Returns from investing are generally not guaranteed (which means an investor may lose some of his or her money).
However, AMP Retirement Savings Account invests in a capital guaranteed life policy, which means that your investment return (crediting rate) in AMP Retirement Savings Account cannot be negative.
The rate of return for investing in a fund like AMP Retirement Savings Account which invests in capital guaranteed assets is likely, in the longer term, to be less than for most other asset classes
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Depending on your account balance, and crediting rate, your investment rate of return can be equal to or lower than the rate of inflation. This means there is a risk that the value of your super can fall, in real terms.
A capital guaranteed investment is designed to give you security in the shorter term. This is usually at the potential cost of lower returns over the longer term.
Other risks
When investing in super, it is important to understand that:
– You may not be able to access your super, because of preservation rules.
– Laws affecting super may change, which may affect the amount of your super and when you can access it.
– We can change the rules of AMP Retirement Savings Account at any time.
– Your investment and future super savings may not be sufficient to provide an income for the rest of your life.
You should read the important information about Risk of investing before making a decision. Go to the Fact Sheet available at www.amp.com.au/rsa. The material relating to Risk of investing may change between the time you read this PDS and the day when you acquire the product.
5. How we invest your money
AMP Retirement Savings Account invests in a capital guaranteed life insurance policy issued to us by AMP Life.
We are the policyowner of the life insurance policy. Under this policy, AMP Life guarantees to us the full value of members’
benefits.
This life insurance policy is a participating policy in AMP’s No.1 Fund. Participating policies are administered in accordance with the Life Insurance Act 1995 and the Insurance Contracts Act 1984. Under these Acts, an annual profit is determined for each class of participating policies and shared between the policyowner and the life office. At least 80% of that profit must be allocated to the participating policyowner(s).
Currently for the AMP Retirement Savings Account, 92.5% of the annual profit is allocated to the policyowner (the trustee) and 7.5% is allocated to AMP Life.
The RSA crediting rates declared are a distribution of our profit to members.
Who is AMP Retirement Savings Account designed for?
Individuals who want:
– Capital security for their super.
– To consolidate all their super in a secure investment.
Investment objective
The investment objective for account balances over $2,500, is to provide returns (adjusted for costs and tax) over the longer term exceeding those from cash. For all account balances, returns are guaranteed to not be negative.
Investment strategy
The investment strategy is to invest in a portfolio with a core of cash and limited exposure to shares. Changes to investments can be made according to the outlook for the various sectors and the nature of the plan.
The long-term strategic mix of assets that back the plan are usually in the following ranges:
Shares and Alternative Investments 0% - 20%
Fixed Interest and Cash 80% - 100%
Minimum suggested timeframe and risk level
As the RSA invests in a capital guaranteed life policy, there is no minimum suggested timeframe for investment and the overall level of risk of investing in the RSA is low.
You should read the important information including How your investment works before making a decision.
Go to the Fact Sheet available at www.amp.com.au/rsa. The material relating to How your investment works may change between the time you read this PDS and the day when you acquire the product.
6. Fees and costs
Did you know?
Small differences in both investment performance and fees and costs can have a substantial impact on your long-term returns.
For example, total annual fees and costs of 2% of your account balance rather than 1% could reduce your final return by up to 20% over a 30 year period (for example, reduce it from $100,000 to $80,000).
You should consider whether features such as superior investment performance or the provision of better member services justify higher fees and costs.
You may be able to negotiate to pay lower contribution fees and management costs where applicable. Ask the fund or your financial planner.
To find out more
If you would like to find out more, or see the impact of fees and costs based on your own circumstances, the Australian Securities and Investments Commission (ASIC) website (www.moneysmart.gov.au) has a superannuation fee calculator to help you check out different fee options.
The calculator on the ASIC website (www.moneysmart.gov.au) can be used to calculate the effect of fees and costs on your super account balance.
The table below indicates the fees and costs for the AMP Retirement Savings Account. The table can be used to compare the costs of different superannuation products. These fees and costs are deducted from your investment returns.
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Type of fee or cost Amount
Fees when your money moves in or out of the fund
Establishment Fee Nil
Contribution Fee Nil
Withdrawal Fee Nil
Termination Fee Nil
Management costs The fees and costs for managing your investment.*
The management costs consist of expenses incurred in running the fund and Performance Based Fees paid monthly out of the fund assets.
These costs are reflected in the crediting rates which are set in advance and applied daily to your account balance.
These costs are not deducted directly from your account.
The gross costs of the fund are estimated as 2.17% pa.**
The net costs of the fund are estimated at 1.84% pa.**
* This fee includes an amount payable to your financial planner (see “Payments to your financial planner” in the Fact Sheet).
** The estimates are based on the actual fund costs for the year to 31 December 2011. The management costs are not fixed and will vary depending on performance and expenses.
Example of annual fees and costs for AMP Retirement Savings Account
This table gives an example of how the fees and costs in the AMP Retirement Savings Account can affect your superannuation investment over a 1 year period. You should use this table to compare this product with other superannuation products.
Example Balance of $50,000 with
total contributions1 of
$5,000 during the year.
Contribution Fees Nil For every $5,000 put in, you will be charged $0.
Plus
Management costs 2.17%2 And, for every $50,000 you will have in the account you will be charged $1,0852,3 each year.
Equals
Cost of Account If you put in $5,000 during a year and your balance was $50,000, then for that year you will be charged fees of:
$1,0853
What it costs you will depend on the investment option you choose and the fees you negotiate with your fund or financial planner.4 1. The contribution of $5,000 is assumed to be deposited to your
account at the end of the year.
2. The Management Costs of 2.17% above are for the 12 month period ending 31 December 2011.
3. The amount of fees and costs you actually pay in your account is reduced by 15% to allow for the benefit of the tax deductions passed on to you. The amount you actually pay is $922.25.
4. There is no other investment option and fees cannot be negotiated with the fund or financial planner.
Fees paid to financial planners
AMP Life will pay a standard commission to the financial planner who advises you or your employer on AMP Retirement Savings Account. This commission is a cost of the fund. The commission amount is not negotiable. These costs are reflected in the crediting rates for all members.
The standard commission is 0.25% pa of your total account balance as at 30 June each year. AMP Life pays an additional 10% on the commission amount above for GST if your financial planner is registered for GST purposes. Your financial planner will pay this extra 10% to the ATO.
You do not pay this standard commission in addition to the management costs shown in the Fees and costs table above.
You may have to pay additional fees to a financial planner if you consult one. You may agree with your financial planner a fee to be paid for financial planning services provided to you in relation to AMP Retirement Savings Account. This fee may be:
– a one-off dollar amount paid as a lump sum, and/or – an ongoing fee, paid monthly, which is either a fixed dollar
amount or a set percentage of your account balance.
The Statement of Advice from your financial planner details any fees for their financial planning services.
Changing the fees
We can introduce new fees or change existing fees at any time.
We will notify you at least 30 days before we introduce new fees or increase existing fees.
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The trust deed permits us to introduce a Trustee Fee of 3%
each year of the amount you have invested (this fee is currently not charged).
New fees can be charged or existing fees changed if:
– AMP Life changes its fees under the superannuation policy we hold.
– Permitted by law.
In this product, expenses are ultimately reflected in the crediting rates (crediting rates can change at any time without prior notice to you).
You should read the important information about Fees and other costs before making a decision. Go to the Fact Sheet available at www.amp.com.au/rsa. The material relating to Fees and other costs may change between the time you read this PDS and the day when you acquire the product.
7. How super is taxed
As an incentive to save for your retirement, the super system offers attractive tax benefits.
Generally your super may be taxed in the following situations:
Type of tax Description How the tax is paid When
contributions are made
Employer, salary sacrifice and personal member contributions for which a tax deduction is claimed are taxed at a rate of up to 15%, which is known as
“contributions tax”.
Contributions tax is paid by us to the ATO quarterly. We will deduct this tax from your account quarterly (or earlier when you close your account).
On your earnings while your money is invested
A maximum of 15%
tax is applied to the investment earnings of your super.
This tax is deducted before we declare investment returns (that is, crediting rates are net of this tax).
When you withdraw money from super and you are under age 60
If you withdraw your money as a lump sum and don’t transfer that money directly to another super fund, then generally you are subject to lump sum tax based on the taxable component of your withdrawal benefit.
Tax is payable on assessment of your income tax return, but we deduct an amount from your withdrawal benefit as prescribed by law. The prescribed amount deducted may differ from the tax payable on assessment.
When you withdraw money from super and you are age 60 or over
No tax is payable. -
Collecting your Tax File Number (TFN)
When you apply for AMP Retirement Savings Account, you should consider providing us with your TFN. If your employer nominates you to join AMP Retirement Savings Account they must give us your TFN if you have given it to them. If you or your employer don’t tell us your TFN:
– Any employer contributions will have the “No-TFN tax” applied at the rate of 31.5%. This is in addition to the contributions tax you have already paid on those contributions. This “No-TFN tax” is calculated and deducted at the earlier of 30 June each year and when you close your account.
– We may have to deduct higher tax than we would otherwise have to on your superannuation lump sum withdrawals and the income payments we make to you.
– We cannot accept any personal contributions and certain other types of contributions.
Tip: Check your statement to see if we have your TFN.
If we don’t, you should consider giving it to us to avoid us deducting extra tax from your account.
Excess contributions taxes
If you exceed the maximum amount of contributions (called
“caps”) set by the government in any financial year for a person your age, you may be required to pay an excess contributions tax of up to 46.5% of the excess. If this occurs, the Australian Taxation Office will issue you with an assessment and a Release Authority and you will need to pay the tax within 21 days. This tax may, or in some circumstances must, be paid from your super account balance.
Tip: Keep an eye on contributions to all your superannuation funds to avoid exceeding the caps. We do not monitor super contributions made to your account against the caps.
You should read the important information about Tax and social security before making a decision. Go to the Fact Sheet available at www.amp.com.au/rsa. The material relating to Tax and social security may change between the time you read this PDS and the day when you acquire the product.
8. How to open an account
Individuals
AMP Retirement Savings Account no longer accepts new personal applications.
Employer sponsors
AMP Retirement Savings Account no longer accepts new employer-sponsored applications. Existing employer sponsors can continue to add new employees to their employer plan.
Employee members
Your account is automatically opened when your employer nominates you to join their AMP Retirement Savings Account - Employer plan.
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Cooling-off period
“Cooling-off” rights do not apply to employee members.
Enquiries and complaints process
All aspects of AMP Retirement Savings Account are governed by the fund’s trust deed and insurance policies held by us,
including in the event of a dispute.
You can find out additional information about your AMP Retirement Savings Account, and request a copy of this PDS and any additional information that has been referred to in this PDS, from your financial planner or AMP Customer Service.
If you are unhappy about any aspect of your account or our service, please contact AMP Customer Service:
Online amp.com.au/enquiry Phone 131 267
Mail Customer Service AMP Life Limited
PO Box 300
PARRAMATTA NSW 2124
Fax 1300 301 267
Internet www.amp.com.au
My Portfolio www.amp.com.au/myportfolio
We will try to resolve your complaint as quickly as possible.
If we cannot resolve it immediately, we will keep you informed about our progress.
Where we cannot resolve your complaint within 90 days or if you are unhappy with our decision, you may be able to lodge a complaint with the Superannuation Complaints Tribunal (SCT).
The SCT is an independent body established by the Government to review certain decisions of superannuation trustees.
Superannuation Complaints Tribunal Website sct.gov.au
Phone 1300 884 114 Or write to Locked Bag 3060
MELBOURNE VIC 3001
Time limits apply to certain complaints to the SCT. If you have a complaint, you should contact the SCT immediately to find out if a time limit applies.
The SCT can only become involved after the Trustee’s efforts at resolving your complaint have failed.
9. Other information
You should read the additional important information about Collection of Tax File Numbers, AMP and your privacy, (including our collection of your personal information to establish and manage your AMP Retirement Savings Account and for related purposes such as providing you with information about other AMP financial services), Additional identification requirements, and what occurs when Leaving your employer, before making a decision. Go to the Fact Sheet available at www.amp.com.au/rsa. The material relating to these subjects may change between the time when you read this PDS and the day when you acquire the product.
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AMP Retirement Savings Account
Fact Sheet
ISSUED 21 JUnE 2012
Issued by AMP Superannuation Limited ABN 31 008 414 104, AFSL No. 233060, the trustee of the AMP Superannuation Savings Trust ABN 76 514 770 399.
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This is the Fact Sheet for AMP Retirement Savings Account (RSA). The AMP Retirement Savings Account Fact Sheet is an important document.
The information in this Fact Sheet forms part of the AMP Retirement Savings Account Product Disclosure Statement (PDS) dated 21 June 2012 for new employee members of existing employer plans. You should consider the PDS and this Fact Sheet before making any decision about whether to acquire or continue to hold the account. The PDS is available online at www.amp.com.au/rsa.
The information in this Fact Sheet is of a general nature only. It is not based on your personal objectives, financial situation and needs.
You should consider whether the information in this Fact Sheet is appropriate for you in accordance with your objectives, financial situation and needs. To obtain advice or more information about the account covered in the PDS you should speak to a licensed or authorised financial planner.
AMP Superannuation Limited (ASL) and other providers
AMP Superannuation Limited is the trustee of the AMP Superannuation Savings Trust (of which AMP Retirement Savings Account is a part) and is referred to as “Trustee”, “we” or “us” in this Fact Sheet.
AMP Life Limited guarantees that the rate of return will never be negative. Apart from this, none of the trustees, or any other company in the AMP group or any of the investment managers of AMP Retirement Savings Account:
– is responsible for any statements or representations made in this Fact Sheet, or
– guarantees the performance of ASL’s obligations to members nor assumes any liability to members in connection with AMP Retirement Savings Account.
An investment in AMP Retirement Savings Account is not a deposit with the trustee and is not a deposit with, or other liability of, AMP Bank Limited ABN 15 081 596 009 (AMP Bank), or any other company in the AMP group. The trustee is not a bank. The AMP Bank does not stand behind the trustee.
AMP companies receive fees and charges in relation to AMP Retirement Savings Account outlined in the PDS and Fact Sheet.
AMP employees and directors receive salaries and/or benefits from AMP companies.
This offer is available only to persons receiving (including electronically) the PDS and Fact Sheet within Australia.
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Information on your account 2
How it works 2
How do I join? 2
Types of contributions 2
Consolidating your super 5
Other information 5
Contribution Caps and the Excess
Contributions Taxes 5
Tax and social security 7
Family law and your super 9
Your Death benefit 9
Your beneficiaries 9
Paying your Death benefit 10
Keeping you informed 11
My Portfolio - online information about
your account 11
Legal arrangements 11
The relationship between the Trustee and
other service providers 12
AMP and your privacy 12
Additional identification requirements 13 Collection of Tax File Numbers 13 Other information on your account 13
How to transact 14
Transacting on your account -
quick reference table 14
Money in 14
Choosing your super fund 14
Your employer’s contributions 14
How we invest your money 15
Money out 15
Leaving your employer 16
How your investment works 17
Investment manager 17
Investment objective 17
Investment strategy 17
Risk of investing 17
How are crediting rates determined? 17
Fees and other costs 19
Fees and other costs 19
Additional explanation of fees and other costs 20
Performance Based Fees 20
Small account protection 20
Payments to your financial planner 20 Alternative Forms of Remuneration Register 21 Transaction and operational costs 21
Changing the fees 21
Employer plans 22
Award modernisation - Important information for employers in respect of
Award covered employees 22
How to transact 22
Making contributions 22
Additional information 23
Policy committee 23
Cooling-off 23
Enquiries and complaints process 24
Super Complaints Tribunal 24
Contents
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Information on your account
How it works
AMP Retirement Savings Account (RSA) is a capital guaranteed superannuation account open to new employees of existing employer sponsors.
How do I join?
Individuals
AMP Retirement Savings Account no longer accepts new personal applications.
Employer sponsors
AMP Retirement Savings Account no longer accepts new employer-sponsored applications. Existing employer sponsors can continue to add new employees to their employer plan.
Employee members
You can become a member of AMP Retirement Savings Account by being nominated for membership by your employer.
Types of contributions
We can accept the following contributions into your account:
Contribution type Description
Member contributions Contributions you as a member pay either from your after-tax income or which you personally claim as a tax deduction.
Spouse contributions Contributions your spouse pays into your account (however, to be eligible to claim a tax offset, amongst other matters, your spouse must not be entitled to a tax deduction for the contributions and must not live separately from you on a permanent basis and your assessable income (including any reportable fringe benefits and reportable employer superannuation contributions) for the financial year must be less than $13,800).
Superannuation Guarantee (SG) and Award/Industrial Arrangement Employer contributions
Contributions an employer pays to avoid a liability for SG charge, and contributions paid to comply with an Award or Industrial Arrangement.
Salary sacrifice and additional employer contributions
You may be able to arrange for your employer to make contributions to your account instead of paying you an equivalent amount of pre-tax salary.
These salary sacrifice contributions and are treated as employer contributions. Your employer can also make employer contributions to your account in addition to SG, Award/Industrial Arrangement and salary sacrifice contributions.
Government
co-contributions You may be eligible to receive a co-contribution from the Government (see page 4 for more details).
Overseas transfers We can accept overseas transfers (including UK transfers).
Directed termination
payments An employment termination payment made by an employer before 1 July 2012 due to legal entitlements existing as at 9 May 2006.
Transfers and rollovers You can transfer or rollover existing superannuation monies into your account, at any time, no matter how old you are.
Certain contributions cannot be accepted if we don’t have your Tax File Number (see “Collection of Tax File Numbers” on page 13). If contributions made in a year exceed the Contributions Caps, you may be taxed on the excess contributions (see “Contribution Caps and the Excess Contributions Taxes” on page 5). There are also certain limits on the amount that can be accepted as a single non-concessional contribution.
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When can we accept contributions?
There are restrictions on the types of contributions we can accept into your account depending on your age, the number of hours you are working and other factors. These are set out in the table below:
Type of contribution6 You are
under age 65 You are
age 65 to 69 You are
age 70 to 747 You are age 75 or over Member contributions1,8 At any time Only if you have been
gainfully employed on at least a part-time basis during the financial year in which the contributions are made3
Only if you have been gainfully employed at least on a part- time basis during the financial year in which the contributions are made3
Cannot be accepted
Spouse contributions1,5 At any time Only if you have been gainfully employed on at least a part-time basis during the financial year in which the contributions are made3
No spouse contributions
accepted Cannot be accepted
Employer contributions - Superannuation Guarantee (SG)1,2 and Award/Industrial Arrangement1,4
At any time At any time Award/Industrial Arrangement employer contributions at any time and from 1 July 2013, SG contributions at any time
Award/Industrial Arrangement employer contributions at any time and from 1 July 2013, SG contributions at any time
Salary sacrifice and additional employer contributions4
At any time Only if you have been gainfully employed on at least a part-time basis during the financial year in which the contributions are made3
Only if you have been gainfully employed on at least a part-time basis during the financial year in which the contributions are made3
Cannot be accepted
Directed termination payments, CGT exempt contributions and overseas transfers7
At any time Only if you have been gainfully employed on at least a part-time basis during the financial year in which the contributions are made3
Only if you have been gainfully employed on at least a part-time basis during the financial year in which the contributions are made3
Cannot be accepted
Government
co-contributions At any time At any time In limited
circumstances5 Not applicable Government low
income superannuation contributions9
At any time At any time At any time At any time
Transfers/rollovers At any time At any time At any time At any time
1. Member and spouse contributions cannot be accepted (and therefore no Government co-contributions can be received) if we don’t have your Tax File Number (TFN). Any concessional contributions in excess of the Concessional Contributions Tax will be liable for an additional 31.5% tax and will count towards your Non-concessional Contributions Cap. Any after-tax personal member contributions (including spouse contributions received) in excess of the Non-concessional Contributions Cap will be subject to Excess Contributions Tax of 46.5%.
The ATO treats all member contributions, in the first instance, as “non-concessional”, and adjusts the contributions to “concessional” if a tax deduction is claimed in your income tax return.
2. SG contributions end at age 70 until 1 July 2013 whereby there is no age restriction on eligibility for SG contributions.
3. You are considered to have been gainfully employed on a part-time basis during a financial year if you are gainfully employed for at least 40 hours in a period of not more than 30 consecutive days in that financial year.
4. If we don’t have your TFN an additional tax called the “no-TFN tax” will be deducted from your account.
5. You must be under age 71 at the end of the financial year in which an after-tax contribution is made to receive a Government co-contribution.
6. Personal and non-mandated contributions can be accepted after age 75 if made in the 28 days following the end of the month you turn age 75. You must also have been gainfully employed on at least a part-time basis in the financial year contributions are made.
7. Directed termination payments can only be rolled over up to 30 June 2012.
8. Payments from a First Home Saver Account into super will be treated as a member contribution and are subject to the Non-concessional Contributions Cap. They are not eligible for the Government co-contribution. Such payments can be made after age 65 without the need to be working on at least a part-time basis.
9. A Government low income superannuation contribution of up to $500 per year may be paid in respect of a member who had a concessional contribution made in respect of the member on or after 1 July 2012 and the member’s adjusted taxable income for the financial year does not exceed $37,000 pa. See “Government low income superannuation contribution” on page 4 for more information.
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Government co-contributions
The Federal Government provides a matching co-
contribution for every $1 of after-tax personal contributions, up to a maximum co-contribution limit per year. Currently, it applies if you:
– Earn at least 10% of your total income** (gross assessable income plus reportable fringe benefits plus reportable employer super contributions) from carrying on a business, eligible employment as defined for co-contribution purposes or a combination of both.
– Earn less than $61,920* in total income.**
– Are not a temporary resident at any time in the financial year.
– Are under 71 years of age at the end of the financial year in which your contribution was made, and
– Lodge an income tax return with the ATO for the financial year.
Your entitlement:
If your total income** is $31,920* or less in a financial year, the Government will contribute $1 for every $1 of after-tax personal member contributions with a maximum co-contribution of $1,000.
If your total income** is more than $31,920* but less than
$61,920* in a financial year, the Government co-contribution is $1,000 reduced by 3.333 cents for each dollar your total income is over $31,920.* If your total income** is $61,920*
or more in a financial year, you are not entitled to a Government co-contribution.
When received, the co-contribution is treated in the fund as a non-concessional contribution and is subject to the preservation rules. However, the Government
co-contribution is not counted towards the Non-concessional Contributions Cap.
* Indexed annually, but indexation is temporarily frozen. On 11 May 2011, the Government announced that it will continue to freeze the co-contribution income thresholds for an additional year to 2012/2013. Furthermore, in its 2011/2012 mini-budget, the Government announced that from the 2012/2013 year and onwards the matching rate will be 50%, meaning the maximum co-contribution will be $500 pa for a $1,000 member
contribution. The income thresholds will be $31,920 and $46,920.
These proposed changes have not yet been made law.
** Reduced by amounts for which the person is entitled to a deduction for carrying on a business.
Government low income superannuation contribution
From 1 July 2012 onwards, the Government will make a contribution of up to $500 in a financial year in respect of a member where:
– The member’s adjusted taxable income for the financial year does not exceed $37,000.
– A concessional contribution in respect of the member was made in the financial year.
– The member earns at least 10% of the member’s total income* (gross assessable income plus reportable fringe benefits plus reportable employer super contributions) from carrying on a business, eligible employment as defined for co-contribution purposes or a combination of both, in the financial year.
– Are not a temporary resident at any time in the financial year.
* Reduced by amounts for which the person is entitled to a deduction for carrying on a business.
The amount of the Government low income superannuation contribution that will be made in respect of an eligible member in a financial year is determined as the lesser of:
a) 15% of the total concessional contributions made in respect of the member in the financial year, and b) $500,
provided that where the amount worked out under (a) above is less than $20, no Government low income superannuation contribution will be paid to the member in respect of that financial year.
Contribution splitting
You may, under certain circumstances, be able to split to your spouse’s super up to 85% of your annual:
– Employer contributions, and
– Member contributions you claim as a tax deduction.
The amount that can be split cannot exceed your Concessional Contributions Cap.
Non-concessional contributions (eg member contributions from your after-tax income) cannot be split.
Each year you can only make one application to split contributions. This application can be made at any time during the financial year that immediately follows the financial year in which the contributions were made. Also, if you close your Super account, then you can split the contributions made during the year in which you close the account. Please contact us for additional information.
UK pension transfers
AMP Retirement Savings Account is currently able to accept amounts from United Kingdom (UK) pension schemes.
Qualifying Recognised Overseas Pension Scheme (QROPS) concessional tax arrangements apply. The UK Revenue &
Customs has confirmed that the AMP Superannuation Savings Trust, of which AMP Retirement Savings Account is a part, is registered as a QROPS. Members who transfer UK pension scheme balances overseas currently only receive concessional tax arrangements if they transfer the balance to a QROPS.
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5 If the UK Revenue & Customs changes the conditions for
QROPS we will notify you via an update on
amp.com.au/pdsupdates. These amounts are regarded as personal member contributions. They can only be made into your account if you satisfy the personal member
contributions rules set out in the table on page 3 and may also count towards your Non-concessional Contributions Cap (see “Tax and Social Security” on page 7).
Other Australian taxation rules also apply especially where amounts are received after 6 months of becoming an Australian resident for taxation purposes.
Please contact us on 13 12 67 if you need more information.
To request a transfer you can provide us with the information either in your application or through My Portfolio.
How to make contributions
You, your spouse or your employer can make contributions using the following payment methods:
Method of payment Description
Bpay® (Reference details will be provided in your Welcome Pack and are also accessible via My Portfolio)
You, and your employer can use Bpay to make a payment at any time.
Bpay biller codes:
–Member contributions: 6528 –SG and Award contributions:
879106
–Salary sacrifice and additional employer contributions: 443739.
Cheque You can send us a cheque payable to “AMP Retirement Savings Account” together with your member number and the contribution type to:
Customer Service AMP Limited PO Box 300
PARRAMATTA NSW 2124 Please ensure that all relevant information accompanies your cheque to help ensure the
investment of your contributions is not delayed.
Spouse contributions can only be made by cheque. Simply state it is a spouse contribution.
® Registered to Bpay Pty Ltd ABN 69 079 137 518.
Consolidating your super
If you have more than one super account in various superannuation funds, you could benefit by consolidating your super into a single account. Consolidating your super into your AMP Retirement Savings Account isn’t difficult or confusing. Our Super Simple Service makes consolidation easy by doing most of the paperwork for you and contacting your existing super funds to make sure your super is where you want it.
You can request to consolidate your super online at amp.com.au/consolidate, or by calling us on 133 888.
Important: Before consolidating, you need to consider how your existing superannuation accounts compare to AMP Retirement Savings Account, and what effect
consolidating will have on any insurance cover and whether any exit fees apply. If you are unsure, speak with your financial planner or contact AMP.
Other information
Spouse contributions - possible tax benefit
You may be able to benefit from a tax offset for making contributions to your spouse’s super or by having them make contributions to your super. Your financial planner can provide you with more details.Tax deductions for employers and the self-employed
If your employer makes a contribution on your behalf (including salary sacrifice contributions) then, generally, that contribution is fully tax deductible to the employer.You may be eligible to claim a tax deduction for your personal member contributions if you’re self-employed, or substantially self-employed, or don’t receive more than 10%
of your income from an employer). Different rules apply if you are under 18. Contributions chosen to be excluded from the Non-concessional Contributions Caps (see below) by reason of an eligible CGT exemption cannot be claimed as a personal tax deduction.
Contribution Caps and the Excess Contributions Taxes
Because superannuation benefits you receive from age 60 are tax-free, and employer contributions and personal deductible contributions have no limit, there are constraints on the level of contributions made to a superannuation fund for your benefit that receive tax concessions in
superannuation funds. These constraints are referred to as
“Contributions Caps”, and are shown in the table on the following page.
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6 The Contributions Caps are applied to 2 types of contributions:
Concessional
contributions are generally those contributions or payments that have received some form of tax concession, such as employer contributions that are deductible to the employer and not included in the assessable salary of the employee.
Concessional contributions include:
–Employer contributions (including salary sacrifice contributions).
–Defined benefit “notional” contributions.
–Personal member contributions you claimed as a tax deduction.1 –Certain allocations of surplus, and
–Taxable component of directed termination payments in excess of the $1 million cap.
Non-concessional
contributions are generally “after-tax” or “post-tax” contributions or payments and include:
–Personal member non-deductible contributions (personal after-tax contributions).
–Spouse contributions (including for same sex couples).
–Tax-free part of overseas transfers, and –Excess concessional contributions.
1. Personal member contributions are only converted to “concessional” upon the lodgement and assessment of your income tax return in which the tax deduction is claimed.
The above is not an exhaustive list.
There are exclusions from the Contributions Caps, such as:
– Rollovers from taxed super funds.
– Proceeds from certain small business capital gains concessions, collectively capped at $1,205,000 in 2011/12 (indexed) and $1,255,000 in 2012/13 (indexed) covering the:
– Small business retirement exemption ($500,000 maximum), and – Small business 15 year exemption proceeds.
– Proceeds from certain personal injury settlements.
– Taxable amount of certain overseas transfers, and
– The first $1 million of the taxable component of a directed termination payment, as well as all its tax-free component.
The Contributions Caps are:
Type of
contribution Cap1 Special arrangement or transitional rule Concessional
Contributions Cap $25,000 pa2 or
$50,000 pa3 under “transitional arrangements”
Transitional arrangements of a concessional contributions cap of $50,000 are for a person who is aged 50 or over, and apply until 30 June 2012.
The Government has announced that from 1 July 2014, the $50,000 pa concessional contributions cap will apply to people aged 50 and over whose account balances are less than $500,000. This has not yet been made law.
Non-concessional
Contributions Cap1 $150,0004 pa If under age 65, you can bring forward 2 years of caps. That is, you can make non-concessional contributions of up to $450,000 in one financial year. However, you will not be able to make any further non-concessional contributions for the next 2 years.
1. This cap is also used to limit the amount of contributions a superannuation fund can accept in some circumstances.
2. Normally indexed annually in line with average weekly ordinary time earnings in increments of $5,000 (rounded down). However, the Government has announced that it will continue to freeze the indexation of the Contributions Caps up to and including the 2013/2014 financial year. This proposal has not yet been made law.
3. Not indexed.
4. This cap will be calculated as 6 times the standard $25,000 Concessional Contributions Cap.
Contributions in excess of the Concessional Contributions Cap are taxed at a penalty rate of 31.5% in addition to the 15%
contributions tax.* The 31.5% “Excess Concessional Contributions Tax” may be paid personally, or if the individual elects, by debiting their superannuation account balance.
Note that the excess concessional contributions also count towards the Non-concessional Contributions Cap.
Contributions in excess of the non-concessional caps are taxed at 46.5%. This is called the “Excess Non-concessional Contributions Tax” and must be paid from your account balance.
The excess contributions tax rates are applied to the gross amount of the excess contribution or payment and there is no reduction for death and disability premiums, unlike the standard 15% contributions tax allowance on concessional contributions.
* The Federal Government has announced that from 1 July 2012, individuals with income greater than $300,000 will have the tax concession on their contributions reduced from 30% to 15% (excluding the Medicare levy). This proposal has not yet been made law.
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Release Authority from the Australian Tax Office (ATO)
If the ATO makes an excess contributions tax assessment, a Release Authority (RA) is issued to you.
If the assessment and RA is in relation to Excess
Concessional Contributions Tax, you may either pay the tax directly within 21 days of receipt of the assessment, or send the RA to a superannuation fund holding your investments within 90 days of receipt of the RA for the fund to pay the tax liability from your account. Note however, that payment of the tax liability is due within 21 days from receipt of the assessment. This RA is referred to as a Voluntary Release Authority (VRA).
If the RA is in relation to Excess Non-concessional Contributions Tax, you must forward the RA to the superannuation fund which holds your investments within 21 days of notice of the assessment. The fund must then pay the Release Amount (see below) from your account.
Note that payment of the tax liability is due within 21 days after the date of the notice of assessment. This RA is referred to as a Compulsory Release Authority (CRA). If you do not forward the RA to the superannuation fund which holds your investments within 21 days of receipt of the assessment, the ATO may issue a CRA directly to the Trustee.
The Release Amount is equal to the lesser of:
– the amount specified in the RA.
– the amount requested to be paid by you or the ATO, and – the total value of every superannuation interest (other
than a defined benefit interest) held on your behalf by the Trustee.
Note that the fund will not pay the full tax liability if your plan is less than the liability.
How do you claim a tax deduction for your personal member contributions?
To claim a tax deduction for your personal member contributions you will need to complete a Notice of intent to claim a deduction form specifying the amount of
contributions that you intend to claim as a tax deduction and return it to AMP. At the end of July each year, we send a Notice of intent to claim a tax deduction form to you if you are:
– A new member who has made personal member contributions into your account in the previous financial year.
– An existing member who has made personal member contributions into your account in the previous financial year and claimed a tax deduction in either of the last 2 financial years.
If you don’t receive a form in the mail, you can also call us and ask for a form.
To be valid, your Notice of intent to claim or vary a deduction for personal super contributions form must be lodged with us before the earliest of the following dates:
– The day that you lodged your income tax return for the year(s) for which you are claiming a tax deduction, or the end of the income year after the year for which you are claiming a tax deduction, whichever is the earlier, and
– The date you ceased to have your contributions in your accumulation account, and
– The date part or all of your contribution was used a commence a pension.
Once we receive a completed Notice of intent to claim a tax deduction form, we will send you a Superannuation Fund Acknowledgement. You should keep this for your tax records.
Tax and social security
This tax and social security information is of a general nature only. Tax and social security laws are complex and can change. We recommend you discuss your own circumstances with your financial planner or tax adviser before you decide to invest.
Tax
Superannuation is a long-term way of saving that has tax advantages to help you achieve the income and lifestyle you want in retirement and (if you have insurance) protecting you and your family if you die or become disabled.
Generally, your super may be taxed:
– When certain contributions are made.
– While your money is invested.
– When you withdraw money you can access under age 60.
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8 When contributions
are made An allowance (contributions tax) of 15%* applies to employer contributions such as superannuation guarantee, award, salary sacrifice, additional employer contributions, and member contributions for which a tax deduction is claimed.
If you make after-tax personal member contributions, a spouse makes a contribution to your account or the Government co-contribution is credited to your account, then contributions tax will not be deducted from these contributions.
* The Federal Government has announced that from 1 July 2012, individuals with income greater than
$300,000 will have the tax concession on their contributions reduced from 30% to 15% (excluding the Medicare levy). This proposal has not yet been made law.
If you exceed your Contributions Caps, you will be required to pay an Excess Contributions Tax of up to 46.5% of the excess (refer to “Contribution Caps and the Excess Contribution Taxes” on pages 5 and 6).
Currently, contributions tax is calculated and deducted from your account quarterly and when you leave AMP Retirement Savings Account.
A further tax (called the “no-TFN tax) of 31.5% applies to employer contributions if you do not give us your Tax File Number (TFN). The “no-TFN tax” of 31.5% for not supplying your TFN is calculated and deducted at the earlier of 30 June each year and when you leave AMP Retirement Savings Account. The “no-TFN tax” may be refunded if the TFN is supplied within 4 financial years from when the contribution is made. Any refund will be added to your account and will be subject to the usual cashing and taxing rules.
When you rollover or transfer money from another fund
Generally, rollovers and transfers from taxed sources are not taxed when added to your super. However, any remaining superannuation surcharge liability arising in your previous fund may be transferred to your new account with us. We will subtract any surcharge liability from your account as the law requires us to.
If you have an untaxed element in the taxable component of your benefit, we generally deduct 15% contributions tax at the time you rollover this component.
While your money is
invested A maximum of 15% tax is applied to the investment earnings of your super.
Capital gains on some assets within a superannuation fund that are held for at least 12 months are taxed at an effective rate of up to 10%.
This tax is deducted before we declare investment returns (that is, crediting rates are net of tax).
When you withdraw money from super - over 60
All lump sum and income benefits received by you on or after age 60 are tax-free.
Lump sum tax rates for
under age 60s If you are under age 60, withdraw your money and:
–don’t transfer that money directly to another superannuation fund, then generally you are subject to lump sum tax based on the components of your withdrawal benefit.
(See table below.)
–do transfer this money directly to another superannuation fund, an account-based pension, or other product designed to provide you with an income stream, then you will not need to pay any lump sum tax on this transfer.
Remember, because super enjoys tax advantages, the law restricts when you can access your super. See the “How to transact” section.
For more details, contact a financial planner or AMP.
Component Tax treatment
Tax-free Completely tax-free
Taxable component -
Taxed Element Under age 55*
Maximum = 20%**
Aged 55* to 59 First $165,000^ = 0%
Maximum tax on amounts in excess of $165,000^ = 15%**
Age 60 or over Completely tax-free
* This age is calculated by reference to “preservation age” and is higher than 55 for those born after 1 July 1960.
** Plus 1.5% Medicare levy and for the 2011/2012 financial year, a Flood levy may apply.
^ For the 2011/2012 financial year (will be $175,000 for the 2012/2013 financial year). Note, for the 2011/2012 financial year, this amount (the “low rate cap amount”) is included in the taxable income that is subject to the Flood levy. You are only allowed one low rate cap amount regardless of how many funds you are invested in and whether they are taxed or untaxed. The low rate cap amount may be reduced by previous lump sum withdrawals of tax-free amounts.
This list is not exhaustive. For more details, contact your financial planner or AMP.
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9 Superannuation lump sum
- less than $200 If you withdraw your entire super as a lump sum you will receive it tax-free provided the following criteria are met:
–you are a lost member who is found and the entire amount of your benefit is less than
$200 and results in a closure of your account, or
–you have terminated employment with your AMP Retirement Savings Account employer and the entire amount of your preserved benefit at the time of termination is less than $200.
Note: Super funds are required to transfer certain lost accounts (ie accounts with less than
$200 or accounts that have been inactive for a period of 5 years and have insufficient records to ever identify the owner of the account) to the ATO. Former holders of these accounts will still be able to reclaim their money from the ATO at any time.
Lump sum Death benefits Generally, lump sum Death benefits are tax-free, where the benefit is paid to a dependant under tax law. See below for a definition of dependant.
The taxable component of lump sum Death benefits paid to a non-dependant under tax law will incur 15% tax (on the “taxed element”) plus Medicare levy and 30% tax (on the “untaxed element”) plus Medicare levy.
Non-dependants of defence and police force personnel killed in the line of duty are treated as
“tax” dependants.
Social security
Centrelink may count your investment in this financial product under the means test in certain circumstances.
As the rules are complex, you should seek the advice of your financial planner or seek information from the Financial Information Service provided by Centrelink, or the Veterans’ Affairs Financial Information Service.
Family law and your super
If you separate or divorce from your spouse, then your interest in your super may be split. Currently, in all States and Territories (apart from Western Australia), your interest may also be split if a de facto relationship (including a same sex relationship) breaks down. Your account can also be flagged as part of a separation or divorce - this prevents us from making most types of payments. The law sets down how superannuation interests will be valued and split for these purposes. Splitting or flagging can be achieved by agreement between the separating or divorcing couple or by a court order.
If your AMP Retirement Savings Account is split, then your spouse (including a de facto spouse) will not automatically have a Retirement Savings Account of their own. Your spouse can apply to have a new super account, transfer the benefit to another superannuation fund or take the benefit in cash if they satisfy a condition of release.
If your interest is split, then your spouse’s interest may be transferred to the AMP Eligible Rollover Fund.
Your Death benefit
If you die while you are an AMP Retirement Savings Account member, then we will pay a Death benefit. Your Death benefit is equal to the value of your account balance.
Your beneficiaries
If you are age 18 years or over, you can nominate one or more beneficiaries to receive your Death benefit. Generally, all beneficiaries must be your dependant(s). You can also nominate your estate (we call this your “legal personal representative).
Under superannuation law, you cannot nominate anyone else as a beneficiary.
If you are under age 18, you or your guardian cannot make a Death benefit nomination.
You can decide to make no nomination.
Who is a dependant?
A dependant under superannuation law includes:
– Your spouse1 (including a de facto spouse whether of the opposite or same sex).
– Your children2 (including an adopted child, a stepchild, or ex-nuptial child).
– Any person who is financially dependent on you, and – Any person with whom you have an interdependency
relationship (see “What is an interdependency relationship?” below).
A person must be a dependant on the date of your death to be a beneficiary.
1. Spouse of a person includes:
– the person’s husband or wife,
– another person (whether of the same sex or a different sex) registered on the relationship registers of a State or Territory, (which at the date of this Fact Sheet are Victoria, Tasmania, the Australian Capital Territory, New South Wales and Queensland), or
– another person who, although not legally married to the person, lives with the person on a genuine domestic basis in a relationship as a couple.
Note: For tax purposes, a former spouse is also a dependant.
2. Child in relation to a person includes:
– an adopted child, a stepchild or an ex-nuptial child of the person,
– a child of the person’s spouse, and
– someone who is the child of the person within the meaning of the Family Law Act 1975 (for example, a child as a result of a Court Order giving effect to a surrogacy arrangement).
Note: For tax purposes, only a child under 18 years of age is a dependant unless the child is a financial dependant.
