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ATO allows ERS access to New Zealanders

The Australian Taxation Office is allowing New Zealanders with KiwiSaver accounts to access the Early Release of Superannuation scheme through a loophole.

In an update to its Design and Implementation document, the ATO said those with a KiwiSaver account are able to access the ERS scheme if they transfer their funds to an Australian super fund.

"New Zealand KiwiSaver accounts are not eligible. However, KiwiSaver amounts transferred to an Australian super fund are eligible to be withdrawn," the ATO said.

Previously, the ATO had not allowed those with a KiwiSaver account to gain access to the scheme.

In another update, the ATO said it will allow funds to cancel payments if a member decides they no longer want it.

"If an individual contacts their fund and says they don't want the payment anymore, the fund can act on the member's direction," the ATO said.

"Funds should confirm the member understands they will not be able to apply again in this financial year (or at all if they applied on a temporary resident category)."

The ATO said funds do not have to confirm that outcome with the ATO.

This is also a change from previous directions in which the ATO said members will not have their application revoked for a 'change of mind'.

Interestingly, the ATO has not updated the document to remove the previous guidelines on the 'change of mind' rule.

"Once a determination is made, it cannot be varied," the ATO said.

"Where a member changes their mind because they want a greater amount than what was approved, a lesser amount than what was approved, to change the super fund for release or just to cancel their application and there was no genuine error in their application, the determination will not be revoked."

The ATO added that some funds have been escalating queries to it, where the individual's application was not in relation to that fund.

The ATO has told funds that if an individual contacts them but they do not have information about the member's determination they should confirm with the member they received their determination and check the correct super fund is listed on the approval letter.

Read our full COVID-19 news coverage and analysis here.

Read more: ATOERSKiwiSaverNew ZealandersAustralian Taxation OfficeEarly Release of Superannuation
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