What advice fee can be paid from a Sunsuper account?
Sunsuper allows payments of an advice fee where the Financial Adviser has provided personal advice recommendations in a SoA and/or RoA.
Examples of advice that can be paid from a Sunsuper account:
- Insurance within the fund
- Investment choice
- Additional contributions
- Consolidation of funds into a Sunsuper account
- Retirement planning projections
- Super beneficiaries
Examples of advice that cannot be paid from a Sunsuper account:
- Trauma and business insurance
- Managed funds
- Negative gearing
- Credit advice
- Interests and features in any other superannuation fund other than Sunsuper
- Rolling out the full balance of a Sunsuper member’s account/s.
This is not an exhaustive list, but rather provides guidance around Sunsuper’s obligations under the sole purpose test.
Sole purpose test
When deducting an advice fee from a Sunsuper member’s account, the Trustee of the Sunsuper Superannuation Fund is subject to the sole purpose test requirements contained in the Superannuation Industry Supervision Act 1993.
The Trustee of the Sunsuper Superannuation Fund considers that the advice services provided must have a direct, reasonable, and transparent connection to the purpose of retaining the member’s interest in the Sunsuper Superannuation Fund.
In exercising its responsibilities under the sole purpose test requirements, Sunsuper may apply its discretion in respect of enabling advice fees to be deducted from a member’s account.
Proportioning your advice fee
If the advice services provided do not wholly meet the sole purpose test (advice in relation to Trauma insurance cover for example) then the invoice for the advice services must be apportioned. Sunsuper only permits advice fees to be deducted from a member’s account for the portion of the advice services that are connected to the member’s interest in the Sunsuper Superannuation Fund.
Payment of the advice fee
Once we’ve received the required documentation, we’ll review the request and determine if we require more information. When we have successfully processed the documentation, we’ll notify you via email and the advice fee will be paid within 15 business days.
FAQ’s about advice fees
How is the fee paid?
Our preferred payment method is via EFT, however it will depend on the information you provide on the invoice for the advice services. The advice fee is deducted directly from the member’s account, not from the Fund’s reserves. The payment is not a commission paid by Sunsuper to the Financial Adviser or their AFS Licensee.
Will your client receive a tax rebate for the advice fee?
No. Sunsuper does not apply a tax rebate for an advice fee being deducted from a member’s account, and it does not claim a tax deduction for the Sunsuper Superannuation Fund for the payment of an advice fee. This is primarily on the basis that establishing and implementing a financial plan is not tax deductible. While it’s possible for ongoing financial advice fees to be tax deductible, Sunsuper does not allow payments for ongoing financial advice services from a member’s account (either monthly or annually).
Ongoing service fees
Sunsuper does not allow payment of ongoing financial advice service fees under standard registration arrangements. However, in the instance where an adviser is reviewing a Sunsuper member’s account, the adviser is allowed to request payment of an advice fee as long as the advice has been documented in a SoA and/or RoA.
The advice provided in the SoA and/or RoA may be either; a recommendation that nothing needs to be altered on the Sunsuper account, or recommendations of either minor or substantial changes to the Sunsuper account. Where an RoA has been prepared, Sunsuper does not require the RoA to be physically handed to the client.
Is there a minimum balance the member must have in their Sunsuper account?
Yes. To charge the advice fee, the Sunsuper member must have a balance of $3,000 after the advice fee has been charged. For example, if your advice fee is $1,000 the member’s balance must be at least $4,000 for the advice fee to be approved. This is to protect the loss of any insurance cover the member may have and to keep the member’s account “active”.
Please note that payment cannot be made:
- if the Sunsuper member’s account balance of $3,000 is not maintained,
- after the Sunsuper member’s account has been closed, or
- prior to us receiving any rollover funds into a prospective Sunsuper member’s account.