The regulatory and operating expense recovery will initially be paid from the Fund’s existing reserves rather than debited from members' accounts. There will therefore be no immediate impact to clients' accounts. The regulatory and operating expense recovery won’t appear in members’ cash transactions for as long as these expenses are covered by the Fund’s reserves.
- How will the regulatory and operating expense recovery impact my clients?
- What are the expenses that Macquarie Investment Management Limited (MIML) is recovering from the reserve?
- Is MIML allowed to recover these expenses from the reserve?
- What products does the new regulatory and operating expense recovery apply to?
- Why is MIML only now passing on regulatory and operating expenses?
- Is this expense tax deductible by the member?
How will the regulatory and operating expense recovery impact my clients?
What are the expenses that Macquarie Investment Management Limited (MIML) is recovering from the reserve?
At the time of communicating to clients, the expenses that will be charged to the Fund are the APRA Supervisory Levies which are collected by APRA from the financial sector and used to fund elements of financial industry-related operations of APRA, ASIC, the Australian Competition and Consumer Commission (ACCC), the Australian Taxation Office’s SuperStream and the Department of Human Services.
For further information on reserves, please see What is a Superannuation Fund reserve?
Is MIML allowed to recover these expenses from the reserve?
MIML is entitled to recover certain expenses which have been incurred by MIML in relation to the operation of the Macquarie Superannuation Plan from the Fund’s assets including from members accounts. This is set out in the Macquarie Superannuation Plan Trust Deed. These expenses will be paid from the Fund’s reserves and not deducted from member accounts for as long as the reserve is able to meet the expenses.
If the Fund’s reserves becomes insufficient to meet these expenses, the expenses may be deducted from member accounts. If this is likely to occur, MIML will give members prior notice.
What products does the new regulatory and operating expense recovery apply to?
The new regulatory and operating expense recovery applies to all Super and Pension products in the Macquarie Superannuation Plan. These are:
- Macquarie Super and Pension Manager
- Macquarie Super Accumulator
- Macquarie Super and Pension Consolidator
- Macquarie Super and Pension Consolidator II
- Macquarie Super and Pension Manager II
- Premium Portfolio Solution
- Vision.
Why is MIML only now passing on regulatory and operating expenses?
MIML has historically covered the cost of the regulatory and operating expenses on behalf of members. To ensure the sustainability of the Fund, continued focus on platform development and improving member outcomes, MIML is passing on this cost to be recovered by the Fund’s reserve. This is an equitable use of the Fund’s reserve for the benefit of members over time.
Introducing the regulatory and operating expense recovery is not new to the industry with many of our competitors already passing these expense recoveries onto members.
Is this expense tax deductible by the member?
As there is initially no charge to members’ accounts, there is no tax deduction available to individual members. However, the Fund may be able to claim a deduction on fees and costs deducted from the reserve.
Chat to us on Adviser Online
Chat in real-time with an adviser consultant Monday to Friday, 8am to 7pm Sydney time (excluding public holidays).
Resolve a complaint
Everyone at Macquarie is commited to providing our clients with the highest standard of products and services available. If you have feedback we would like you to tell us about it.