CommInsure Corporate Insurance. Superannuation Trust. Annual Report 2015

Transcription

1 CommInsure Corporate Insurance Superannuation Trust Annual Report 205 Fund CommInsure Corporate Insurance Superannuation Trust ABN R PO Box 282 ALBURY NSW 2640 Phone: Facsimile: Trustee and Issuer The Trust Company (Superannuation) Limited ABN AFS Licence No RSE Licence No L Registered Office Level 20, 357 Collins Street Melbourne VIC, 3000 Administrator Super Managers Funds Administration Pty Ltd ABN AFS Licence No Insurer The Colonial Mutual Life Assurance Society Limited ABN AFS Licence No This Annual Report should be read in conjunction with the annual member statement recently provided to you, which shows your member entitlements at 30 June 205.

2 CONTENTS From the Trustee About CCIST The CCIST s Accounts 4 Operation Of CCIST s Reserve 5 Managing the CCIST 5 Privacy Policy 5 More Information 5 Directory 6 Features Insurance protection for members within a superannuation environment Death cover and total and permanent disablement cover if selected by employer Competitive premiums Insurance premiums paid by participating employer not the member Binding and non-binding beneficiary nominations For detailed information about these features see the CommInsure Corporate Insurance Superannuation Trust s ( CCIST ) Product Disclosure Statement (PDS). For a copy of the PDS contact the CCIST Administrator using the contact details in the Directory at the back of this report. Membership At July 204 6,725 New members 357 Members who left the CCIST 7 At 30 June FROM THE TRUSTEE We are pleased to present our Annual Report for the year ended 30 June 205 This report is issued by The Trust Company (Superannuation) Limited ( the Trustee ), ABN , RSE Licence No. L , AFS Licence No The information provided in this report is in accordance with the requirements of the Corporations Act and Corporations Regulations 200. The information is of a general nature only and has been prepared without taking into account your investment objectives, financial situation and needs. Before making any decisions in relation to the CCIST you should consider obtaining professional financial advice from a Licenced or authorised financial advisor. Whilst all due care has been taken in the preparation of this report, the Trustee reserves its right to correct any errors or omissions. The terms of your membership in the CCIST are set out in the CCIST s Trust Deed and any applicable insurance policy. Should there be any inconsistency between this report and the CCIST s Trust Deed, the terms of the CCIST s Trust Deed will prevail. The Trustee holds professional indemnity insurance to protect the Trustee, its directors and the CCIST against certain losses or liabilities. The indemnity insurance cover is subject to the terms and conditions of the relevant insurance policy. The Trustee of the CCIST changed effective 5 December 204 to The Trust Company (Superannuation) Limited (ABN ), AFS Licence: No The people involved with the management of CCIST remain the same and as such this change will have no effect on your membership with CCIST. ABOUT THE CCIST CCIST is designed to provide insurance benefits to employees of participating employers in a superannuation environment. The participating employer pays the cost and in doing so, may provide members with financial protection against adverse future events such as death or total and permanent disablement. For employers, CCIST can be a convenient way of arranging tax effective life insurance for employees. Contributions paid into the CCIST by employers will generally be tax deductible to the employer. CCIST is a flexible, cost-effective superannuation fund designed to meet the superannuation needs of members by providing death benefits to dependants and, in some cases, total and permanent disablement (TPD) benefits to members. CCIST has no investment component, and as such members will not accrue an account balance. The contributions paid to the CCIST by employers for each member are held until insurance premiums are paid, or insurance proceeds are paid to a member. The investment objective is to maintain the capital value of the funds and this is done solely by holding money in the CCIST bank account. The CCIST does not invest in derivatives. The Directors of the Trustee during the year ended 30 June 205 were: Name Mark Cerché (chairman) Murray Jones Andrew de Vries Vincent Parrott

3 Employer s Contributions As benefits within the CCIST relate to insurance only, members are not able to make any contributions or rollovers for accumulation purposes within the CCIST. The participating employer will make employer contributions on behalf of members. These contributions will be equal to the Insurance Premium payable for the insurance cover as detailed in the applicable PDS Part B: Employee Insurance Guide. 205/6 Superannuation Thresholds The superannuation contributions caps and various other superannuation thresholds that apply for the 205/6 financial year are as follows: Superannuation Threshold Low rate cap: $95,000 Concessional contributions cap: - Age 49 or over on 30 June 205 $35,000 - Under age 49 on 30 June 205 $30,000 Non-concessional contributions cap: $80,000 Capital Gains Tax (CGT) Cap (lifetime limit): $,395,000 Government Co-contributions: - Maximum co-contribution 2 $500 - Lower threshold $35,454 - Upper threshold (cut off) $50,454 if you were under age 65 on July 205 you may be able to make up to $540,000 of non-concessional contributions over three financial years. If you triggered the bring forward non-concessional cap prior to 203/4 financial year, you can only make non-concessional contributions up to $450,000 over the relevant 3 year period. 2 the maximum co-contribution payable is phased out by cents for every dollar of total income over the lower threshold, until it reaches zero at the upper threshold. Details of the cap for later years will be available by calling the Client Service Line on The contributions paid by participating employers for the cover provided under the CCIST are classified as concessional contributions and are included in the concessional contribution cap. Contact the Australian Taxation Office on or visit for further information. Tax File Numbers We are authorised to collect each member s Tax File Number (TFN). It will remain confidential and will be used only for lawful purposes, such as providing information to the Australian Taxation Office. These purposes may change in the future as the result of legislative change. A TFN may be disclosed to another superannuation provider when a member s benefits are being transferred, unless the member requests in writing that their TFN is not to be disclosed to any other Trustee. Membership to the CCIST is only available if a TFN has been provided. Therefore, insurance cover will not be provided to any employees where we do not have a TFN on file. Tax on contributions If a Tax File Number (TFN) is not provided to the CCIST, an additional tax of 30.0% (plus any applicable levies) may apply to the entire contribution. This cost would be borne by the CCIST. For this reason employees will not be accepted as members of the CCIST unless their TFN has been provided. Tax on death benefits The taxation of death benefits will depend on whether the beneficiary is a dependant as defined under taxation law (tax dependant). Note that this is different to the definition of dependant under superannuation law. A person will be a tax dependant if they are: A spouse (this includes married couples, de facto spouses (including same-sex) and certain registered relationships); A child of the member or spouse of the member (including an adopted child, step-child or ex-nuptial child or someone who is a child within the meaning of the Family Law Act 975) so long as the child is under age 8; A person with whom the member had an interdependency relationship A person who was a financial dependant of the member. Also, if any part of the death benefit is paid to a Legal Personal Representative, it may be deemed to have been paid to a tax dependant if the Commissioner of Taxation accepts that the person receiving the payment via the member s estate is a tax dependant. Death benefits are tax-free if paid to a tax dependant. Death benefits paid to a non-tax dependant are generally taxed at 7.0%, inclusive of Medicare levy. A portion of the benefit may be an untaxed element (relating to the future service period of the insurance amount). That element is taxable at the maximum rate of 30.0%, plus any applicable levies. Below is a summary of how lump sum death benefits are taxed: Lump sum paid to: Tax dependants Tax Free Non-tax dependants Taxed element 5% Plus any applicable levies. Tax on terminal illness benefits Untaxed element 30% The insurance policy may allow for death benefit to be paid if the member is terminally ill. Lump sum benefit payments paid to a member who is terminally ill will be tax-free. A member will be taken to be terminally ill if two medical practitioners (at least one of these a specialist) certify that 2

4 the member is suffering from an illness that in the normal course is likely to result in death within 2 months. For each of the certificates, the certification period must not have ended. Tax on TPD benefits Where the Trustee allows, TPD insurance cover benefits paid to those aged 60 or over are generally tax free. Benefits paid to those under age 60 are taxed as set out in the following table: CCIST PO Box 282 Albury NSW 2640 Both forms are located in the PDS. For a copy of the PDS contact the CCIST Administrator using the contact details in the Directory at the back of this report. Age Taxable Component 60 and above Tax free On or over preservation age and under age 60 0% up to Low Rate Threshold 5% 2 over the Low Rate Threshold Under preservation age 20% 2 on the whole amount The Low rate threshold is $85,000 for 205/6 is a lifetime limit per person and is indexed annually to AWOTE in increments of $5, Plus any applicable levies. Insurance Cover Members will receive either death only or death and total and permanent disablement cover through an insurance policy held in the CCIST. The type and level of cover is chosen by the participating employer. The details of the cover provided are explained in the PDS Part B: Employee Insurance Guide. Guaranteed renewability The Insurer guarantees to renew the insurance cover each year provided no termination event has occurred. The insurer will not cancel the insurance cover or increase premiums due to any change in the health, occupation or pastimes of the members during the guarantee period. Binding nomination Members can make either a binding or non-binding death benefit nomination to nominate who is to receive all or part of the member s benefit upon death. If the benefit is paid to the member s Legal Personal Representative, it will be distributed according to their Will. A non-binding death benefit nomination is not binding on, but will be considered by the Trustee. The Trustee will use its discretion when deciding how the death benefit should be paid. A binding death benefit nomination is binding on the Trustee. This means that, provided the nomination is valid at the time of death, the Trustee must pay the death benefit as the member has specified. Please note that binding nominations must be renewed every 3 years. To make a nomination, please complete, amend or cancel your existing Binding or Non-Binding nomination form and return to: 3

5 THE CCIST S ACCOUNTS This is an abridged summary of the CCIST s audited accounts for the year ended 30 June 205. The full audited accounts, including the audit report will be available at the end of October 205. If you would like a copy please contact the CCIST Administrator (see contact details in the Directory on the back cover). CommInsure Corporate Insurance Superannuation Trust Statement of Financial Position as at 30 June $ $ ASSETS Cash and cash equivalents 7,270 2,278,059 Other assets Return of overpaid interest receivable 2,525 - Total assets 2,278,059 LIABILITIES PAYG tax provision - 8,047 Current tax liability - 30 Benefits payable - 2,253,74 Total liabilities 0,707 2,26,53 NET ASSETS AVAILABLE TO PAY BENEFITS 0,707 6,528 Represented by: Liability for accrued benefits Operational Risk Reserve 9,000 9,000 Not yet allocated,707 7,528 0,707 6,528 CommInsure Corporate Insurance Superannuation Trust Operating Statement for the year ended 30 June $ $ Investment revenue from ordinary activities Interest 8,703 9,973 Return of overpaid interest 2,525 - Contribution revenue Taxable contributions 3,48,39 3,05,96 Other revenue Group life insurance proceeds,42,767 2,932,993 Total Revenue 4,572,34 5,994,927 Less expenses Insurance premiums 3,48,39 3,05,96 Bank fees and charges Total expenses 3,48,355 3,052,03 Benefits accrued as a result of operations before income tax,423,959 2,942,896 Income tax expense attributable to benefits accrued as a result of operations,300,485 Benefits accrued as a result of operations,422,659 2,94,4 4

6 Operation of CCIST s Reserve The CCIST operates a Reserve Account. Source and Limits of Reserve The primary purpose of the Reserve is to pay certain CCIST expenses properly chargeable to the CCIST, at the discretion of the Trustee, as they fall due. The Reserve may also be used to facilitate the funding of the CCIST Operational Risk Financial Requirement (ORFR). In this regard, amounts from the Reserve may be transferred to the Operational Risk Reserve. The Reserve will be invested in line with the Trust s investment strategy, as determined by the Trustee from time to time. The amount of the Reserve as at 30 June (for the respective year) is: 30 June Reserve value $ 202, , , ,000 Operation Risk Reserve The Federal Government as part of its Stronger Super reforms has imposed a requirement for funds to establish and maintain an Operational Risk Reserve (ORR) to specifically cover potential losses arising from operational risks that may affect the CCIST s business operations. An operational risk is the risk of a loss resulting from inadequate or failed internal processes, people and systems, or from external events. The ORR may be drawn upon to assist in compensating members or the CCIST in the event of an operational risk having materialised. The Trustee will build up the ORR within the CCIST to the defined target amount over a 3 year transition period leading up to 30 June 206. The ORR will be primarily sourced using available funds from the existing CCIST reserves. If the ORR falls below the target amount, the Trustee will seek to top up the ORR from this source if required. PRIVACY POLICY We are committed to ensuring the confidentiality and security of your personal information. We will only collect, use and disclose this information for the purposes of processing and administering your accounts and providing services to you, unless otherwise required by law. We are bound by the Privacy Act and the National Privacy Principles, as regulated by the Federal Privacy Commissioner, to protect such information from misuse and loss, unauthorised access, modification and disclosure. You can obtain a copy of the Trustee s Privacy Policy from the Privacy Officer. MORE INFORMATION Your benefit statement and the CCIST s PDS contain important information about your personal benefits and the CCIST. You are also entitled to request further information including the Trust Deed and rules, the latest audited accounts and auditor s report and the Trustee s Privacy Policy. The Trust Company (Superannuation) Limited (TTCSL) is required to disclose certain information and documentation on a website. Accordingly, TTCSL s website ( contains the required CCIST information and documentation. The CCIST information and documentation includes, but is not limited to, the following: the Trust Deed, the Product Disclosure Statement, the most recent Annual Report, the most recent Financial Statements and the names of each outsourced service provider to the CCIST For copies of these documents, or if you want more information about your benefits, the CCIST Administrator will be pleased to help. You can contact the CCIST Administrator by phone; send an , fax or writing. See the Directory on the back cover for details. The amount of the Operational Risk Reserve as at 30 June 205 is $9,000 MANAGING THE CCIST The Trustee The CCIST is set up as a trust and is governed by a legal document called a Trust Deed. The Trustee responsible for running the CCIST in accordance with the Trust Deed, is The Trust Company (Superannuation) Limited (ABN , RSE Licence No. L , AFS Licence No

7 Enquiries and Complaints The CCIST has an established procedure for dealing with member enquiries and complaints about the operation and management of the CCIST. Enquiries and complaints should be made to the Administrator. For the cost of a local call, you can call our Client Services Team on (the cost may be higher if calling from a mobile), or us at CCIST@smasuper.com.au. The procedure requires the Trustee to consider and respond to a complaint within 90 days. If you are not satisfied with the Trustee s handling of your complaint or its decision or the Trustee does not respond within 90 days, you may contact the Superannuation Complaints Tribunal. The tribunal is an independent body set up by the Federal Government to assist members or beneficiaries to resolve certain types of complaints with fund trustees. The tribunal may be able to assist you to resolve your complaint, but only if you are not satisfied with the response received from the Trustee s handling of your complaint. If the tribunal accepts your complaint, it may attempt to resolve the matter through conciliation, which involves assisting you and the CCIST to come to a mutual agreement. If conciliation is unsuccessful, the complaint is referred to the tribunal for a determination which is binding. You should be aware, however, that a party may appeal a decision of the tribunal to the Federal Court. DIRECTORY CCIST Administrator Super Managers Funds Administration Pty Ltd ABN AFS Licence No Level, 540 Swift St PO Box 282 ALBURY NSW Fax: (02) Insurer The Colonial Mutual Life Assurance Society Limited ABN AFS Licence No Level 2, 52 Martin Place Sydney NSW 2000 Trustee The Trust Company (Superannuation) Limited ABN AFS Licence No RSE Licence No L Registered Office Level 20, 357 Collins Street MELBOURNE VIC 3000 Phone: If you wish to find out whether the tribunal can handle your complaint and the type of information you would need to provide, phone the following number for the cost of a local call anywhere in Australia: Postal Address Superannuation Complaints Tribunal Locked Bag 3060 MELBOURNE VIC 300 Phone: Fax: (03)