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Commonwealth act
The Retirement Savings Accounts Act 1997 creates and regulates Retirement Savings Accounts (RSAs) — a bank- or insurer‑style, capital‑guaranteed product for holding retirement savings. Only approved banks, credit unions and life insurers may offer RSAs, which are ring‑fenced for retirement and protected from investment losses, assignment, or use as loan security. The law sets prudential, disclosure and tax/portability rules, assigns oversight to APRA/ASIC/ATO, and imposes recordkeeping, audit and penalty obligations on providers — protecting account holders and standardising employer and provider duties.
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Direct links to the current provisions in Retirement Savings Accounts Act 1997.
Sourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.
An Act to provide for retirement savings accounts, and for related purposes
This Act may be cited as the Retirement Savings Accounts Act 1997.
(1) Subject to subsection (2), this Act commences on a day to be fixed by Proclamation. (2) If this Act does not commence under subsection (1) within 6 months after the day on which this Act receives the Royal Assent, it commences on the first day after the end of that period.
(1) Subject to subsection (3): (a) APRA has the general administration of: (i) Part 3; and (ii) Division 4 of Part 4 (Other provisions relating to the operation of RSAs); and (iii) Parts 6 and 9, and Part 11 (except the provisions mentioned in subparagraph (e)(ii)); and (iv) section 183; and (b) APRA also has the general administration of sections 37 to 39 and section 49 to the extent that it is not conferred on either of the following: (i) ASIC by paragraph (d); (ii) the Commissioner of Taxation by paragraph (g); and (bb) APRA also has the general administration of Divisions 2 and 3 of Part 4A to the extent that administration of the provisions is not conferred on the Commissioner of Taxation by paragraph (f); and (c) ASIC has the general administration of: (i) Part 5 (other than section 49); and (ii) Part 7; and (d) ASIC also has the general administration of sections 37 to 39 and section 49 to the extent to which they relate to: (i) the keeping and retaining of records in relation to RSA’s; or (ii) the disclosure of information to holders of RSA’s; or (iii) the disclosure of information about RSA’s (including disclosure of information to ASIC but not including disclosure of information to APRA); or (iv) any other matter prescribed by the regulations for the purposes of this paragraph; and (e) the Commissioner of Taxation has the general administration of: (i) Division 3 of Part 4 (Portability forms); and (ii) Division 2 of Part 11, section 138A, Division 4A of Part 11 and subsection 144(2A) (about tax file numbers); and (f) the Commissioner of Taxation has the general administration of: (i) Division 1 of Part 4A; and (ii) Division 2 of Part 4A, to the extent it relates to employers; and (iii) Division 2 of Part 4A, to the extent it relates to payments and information given to the Commissioner of Taxation; and (iv) Division 4 of Part 4A; and (g) the Commissioner of Taxation has the general administration of regulations made under section 38 to the extent that the regulations relate to the making and notification of determinations that an amount of benefits in an RSA may be released on compassionate grounds.
Note: An effect of a provision being administered by the Commissioner of Taxation (see paragraphs (e), (f) and (g)) is that people who acquire information under the provision are subject to the confidentiality obligations and exceptions in Division 355 in Schedule 1 to the Taxation Administration Act 1953.
(2) The following provisions (amongst other things) confer powers and duties on APRA for the purposes of APRA’s administration of the provisions it administers and on ASIC for the purposes of ASIC’s administration of the provisions it administers: (a) Parts 1 and 2; (b) Part 10; (c) Parts 12 to 15; (d) Part 16 (other than section 183).
Note: Generally neither APRA nor ASIC are referred to in these provisions, Regulator is used instead. See the definition of Regulator in section 16.
(2A) Powers and duties are also conferred by Part 10 on the Commissioner of Taxation for the purposes of the administration of the provisions he or she administers.
Note: Generally, the Commissioner of Taxation is not referred to in these provisions, Regulator is used instead. See the definition of Regulator in section 16.
(3) The Minister may give APRA or ASIC directions about the performance or exercise of its functions or powers under this Act.
This Act applies in relation to RSAs despite any provision in the terms and conditions of the RSA, including any provision that purports to substitute, or has the effect of substituting, the provisions of the law of a State or Territory or of a foreign country for all or any of the provisions of this Act.
This Act extends to all the external Territories.
(1) This Act binds the Crown in each of its capacities. (2) The Crown is not liable to be prosecuted for an offence against, or arising out of, this Act.
The following is a brief summary of the Act:
Brief summary of the Act
Main purpose—provision for RSAs
This Act provides for retirement savings accounts, or RSAs, to be offered by certain financial institutions.
RSAs will provide benefits upon retirement or death and may also provide a limited range of other benefits.
RSAs will have certain restrictions placed upon them to make them similar to other superannuation products.
Concessional taxation and social security treatment of RSAs
RSAs are subject to concessional rules under income tax and social security law.
Supervision of RSA business of providers
The Act also provides for the approval of the entities that can offer RSAs and provides for supervision of the RSA business of those entities.
The general prudential supervision of these entities is not dealt with in this Act.
(1) An RSA, or retirement savings account, is an account or a policy: (a) that is described as an RSA; and (b) that is provided by an entity that is an RSA institution at the time the account is opened or the policy is issued; and (c) that is capital guaranteed (see section 14); and (d) that is held by a person who is an eligible person at the time the account is opened or the policy is issued (see section 13); and (e) that, at the time that it is opened or issued, satisfies: (i) the requirements in section 15; and (ii) any prescribed criteria; and (f) that is opened or issued on or after 1 July 1997 or such later day as is prescribed. (2) However, an RSA, or retirement savings account, can only be provided by a life insurance company as a policy.
Note: Section 16 provides that policy has the same meaning as in the Life Insurance Act 1995.
(1) A person holds an account if the account is opened in the person’s name. The person is the holder of the account. (2) A person holds a policy if the person is the person who is the owner of the policy. The person is the holder of the policy.
(1) A person provides an account if the person accepts, or has accepted, contributions to the account. The person is the provider of the account. (2) A person provides a policy if the policy is issued by the person. The person is the provider of the policy.
(1) A person is an RSA institution at a particular time if there is an approval under section 26 in force in relation to the person at that time which has not been suspended or revoked under section 33. (2) Only an ADI or a life insurance company or a prescribed financial institution can be approved as an RSA institution.
A person is an RSA provider at a particular time if, at that time, the person is the provider of one or more RSAs.
Note: Most RSA providers will also be RSA institutions. However, although every RSA provider must have been an RSA institution at one time, some may have ceased to be an RSA institution.
A person is an eligible person at a particular time if, at that time, the person satisfies any prescribed criteria.
(1) An RSA that is an account is capital guaranteed if the balance of the account may not be reduced by the crediting of any negative interest. (2) An RSA that is a policy is capital guaranteed if the contributions and accumulated earnings may not be reduced by negative investment returns or any reduction in the value of assets in which the policy is invested.
(1) An RSA must be maintained to provide one or more of the benefits specified in subsections (2) and (3). It may also be maintained to provide one or more of the benefits specified in subsection (4). (2) The benefits specified in this subsection are benefits for the holder of the RSA on or after one of, or the earlier of, the following: (a) the holder’s retirement from any business, trade, profession, vocation, calling, occupation or employment in which the holder was engaged (whether the holder’s retirement occurred before, or occurred after, the holder’s account was opened); (b) the holder’s attainment of an age not less than the age specified in the regulations.
Note: A prescribed criterion under paragraph 8(e), or an operating standard under section 38, may prevent any benefits being provided before the holder attains a specified age.
(3) The benefits specified in this subsection are benefits in respect of the holder of the RSA on or after the holder’s death, if: (a) the death occurred before: (i) the holder’s retirement from any business, trade, profession, vocation, calling, occupation or employment in which the holder was engaged; or (ii) the holder attained the age prescribed for the purposes of paragraph (2)(b); and (b) the benefits are provided to the holder’s legal personal representative, to any or all of the holder’s dependants, or to both.
Note: These benefits may be provided directly from the RSA or from policies paid for using money from the RSA.
(4) As long as the RSA is maintained to provide one or more of the benefits set out in subsections (2) and (3), it may also be maintained to provide one or more of the following: (a) benefits for the holder on or after the termination of the holder’s employment with an employer who had, or any of whose associates had, at any time, contributed amounts in the account; (b) benefits for the holder on or after the holder’s cessation of work, if the work was for gain or reward in any business, trade, profession, vocation, calling, occupation or employment in which the holder was engaged and the cessation is on account of ill‑health (whether physical or mental);
Note: These benefits may be provided directly from the RSA or from policies paid for using money from the RSA.
(c) benefits in respect of the holder on or after the holder’s death, if the benefits are provided to the holder’s legal personal representative, to any or all of the holder’s dependants, or to both and:
(i) the death occurred after the holder’s retirement from any business, trade, profession, vocation, calling, occupation or employment in which the holder was engaged (whether the holder’s retirement occurred before, or occurred after, the account was opened); or
(ii) the death occurred after the holder attained the age prescribed for the purposes of paragraph (2)(b);
(d) such other benefits as APRA approves in writing.
In this Act, unless the contrary intention appears:
ADI (authorised deposit‑taking institution) means a body corporate that is an ADI for the purposes of the Banking Act 1959.
annuity has the same meaning as in the Superannuation Industry (Supervision) Act 1993.
approved auditor means a person included in a class of persons specified in regulations made for the purposes of this definition, but does not include a person who is disqualified from being or acting as an auditor of all RSA providers under section 67.
approved deposit fund means a fund that is an approved deposit fund for the purposes of the Superannuation Industry (Supervision) Act 1993.
approved form means a form approved by the Regulator, in writing, for the purposes of the provision in which the expression appears.
APRA means the Australian Prudential Regulation Authority.
ASIC means the Australian Securities and Investments Commission.
associate has the meaning given by section 18.
Australian court means:
(a) the High Court; or
(b) a court created by the Parliament; or
(c) a court of a State or Territory.
authorised person means a person authorised by the Regulator under section 129A for the purposes of the provision in which the expression occurs.
books includes:
(a) any record; or
(b) any accounts or accounting records, however compiled, recorded or stored; or
(c) a document.
capital guaranteed has the meaning given by section 14.
constitutional corporation means a body corporate that is:
(a) a trading corporation formed within the limits of the Commonwealth (within the meaning of paragraph 51(xx) of the Constitution); or
(b) a financial corporation formed within the limits of the Commonwealth (within the meaning of paragraph 51(xx) of the Constitution).
contributing employer means an employer having obligations under Part 4A (about the data and payment regulations and standards relating to RSAs).
contribution includes a deposit into an account held at an ADI or a prescribed financial institution and a payment of a premium to a life insurance company.
court means any court, when exercising jurisdiction under this Act.
Court means the Federal Court of Australia or the Supreme Court of a State or a Territory.
data and payment matter relating to RSAs has the meaning given by subsection 45B(5).
data and payment regulations and standards relating to RSAs means:
(a) the regulations made under section 45B; and
(b) the standards issued by the Commissioner of Taxation under that section.
data and payment standard relating to RSAs means a standard issued by the Commissioner of Taxation under section 45B.
data processing device means any article or material (for example, a disk) from which information is capable of being reproduced with or without the aid of any other article or device.
dependant has the meaning given by section 20.
director, in relation to a body corporate, has the same meaning as in the Corporations Act 2001.
disclose, in relation to information, means give, reveal or communicate in any way.
eligible person has the meaning given by section 13.
eligible superannuation entity has the same meaning as in the Superannuation Industry (Supervision) Act 1993.
employee has the meaning given by section 19.
employer has the meaning given by section 19.
executive officer, in relation to a body corporate, means a person, by whatever name called and whether or not a director of the body, who is concerned, or takes part, in the management of the body.
expert, in relation to a matter, means a person whose profession or reputation gives authority to a statement made by him or her in relation to that matter.
function includes duty.
half‑year means a period of 6 months ending on 30 June or 31 December.
holder has the meaning given by section 9.
holds has the meaning given by section 9.
Income Tax Assessment Act means the Income Tax Assessment Act 1936.
inspector has the meaning given by section 96.
interdependency relationship has the meaning given by section 20A.
investment means any mode of application of money or other property for the purpose of gaining interest, income or profit.
involved, in relation to a contravention, has the meaning given by section 21.
lawyer means a duly qualified legal practitioner and, in r
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