Superannuation Supervisory Levy Imposition Act 1998

The Act relies on a small number of defined legal concepts that determine who pays and how amounts are worked out. Key definitions are in s 5.

• Superannuation entity. The Act defines "superannuation entity" by reference to the Superannuation Industry (Supervision) Act 1993, with the specific exclusion of self managed superannuation funds (s 5). That imports the substantive regulatory boundary used elsewhere in superannuation law. This definition controls whether the trustee is within the levy net.

• Trustee. "Trustee" for levy purposes is the person who is the trustee of the entity for purposes of the SIS Act (s 5). That means legal responsibility for the levy sits with whoever is the trustee under the SIS Act regime.

• Levy imposition day. For an entity that is a superannuation entity on 1 July of a financial year, the levy imposition day is 1 July. If the entity becomes a superannuation entity during the financial year, the levy imposition day is the day it becomes a superannuation entity (s 5). This affects prorating under s 7(2).

• Unregulated entity. The Act defines "unregulated entity" to capture funds, trusts or schemes that are not superannuation entities under the SIS Act, and separately to include SMSFs (s 5). The distinction matters because the calculation base for levies differs depending on whether an entity was an unregulated entity at 30 June of the previous financial year (see s 7(1A) and (1B)).

• Restricted and unrestricted levy components. The levy comprises two components: restricted and unrestricted. The Act prescribes the structure for each component. The restricted component is calculated as a percentage of the entity’s levy base (subject to a maximum and minimum for the year) and the unrestricted component is calculated as a percentage of the levy base (s 7(1)-(1B)). The percentages, caps and base method are annually determined by the Treasurer by legislative instrument (s 7(3)).

• Levy base and Treasurer determinations. The Treasurer has primary rule‑making authority for the annual operational parameters. The Treasurer must, by legislative instrument, determine the maximum and minimum restricted levy amounts, the restricted levy percentage, the unrestricted levy percentage, and how an entity’s levy base is to be worked out (s 7(3)). The Treasurer may make different provision for different classes of superannuation entity and may make more than one determination for a financial year (s 7(4A), (5)). The Act thus centralises year‑to‑year detail setting outside the Act itself.

• Statutory upper limit and indexation. The Act sets a statutory upper limit that operates as a ceiling on the maximum restricted levy amount for a financial year (s 7(4)). The statutory upper limit is concretely specified for the financial year commencing 1 July 2020 as $10,000,000 and for later years it is multiplied by an indexation factor (s 5). The indexation factor is computed from CPI data published by the Australian Statistician and includes a fixed additive adjustment of 0.030 (s 8(1)).

• Collection mechanism. The Act does not itself set payment timing or collection procedures. Instead it imposes the levy in accordance with subsection 8(6) of the Financial Institutions Supervisory Levies Collection Act 1998 (s 6). That establishes linkage to another statute for collection mechanics.

These concepts allocate responsibility to trustees (as defined), delegate quantitative detail to the Treasurer, cap the restricted component via an index‑linked statutory cap, and connect collection to the existing levies collection statute.

The statutory incidence of the levy is placed squarely on trustees of superannuation entities as defined for the purposes of the Superannuation Industry (Supervision) Act 1993, subject to the specific exclusion of self managed superannuation funds (s 5; see definition of "superannuation entity"). That produces a clear set of affected actors:

• Trustees of APRA‑regulated superannuation funds and other entities that are "superannuation entities" under the SIS Act. The Act imports that definition and therefore pulls in the population of funds that are within the SIS regime, excluding SMSFs (s 5).

• Trustees of any superannuation entity that becomes regulated during the financial year. The levy imposition day is the date the entity becomes a superannuation entity if it was not one on 1 July, and the levy calculation rules adjust accordingly (s 5 definition of "levy imposition day"; s 7(1A)-(1B)).

• Trustees of entities that were "unregulated entities" at 30 June of the previous financial year. The Act treats levy bases for entities that were unregulated or not yet in existence as being taken at the time they become superannuation entities, rather than at 30 June of the previous financial year (s 7(1A) and (1B)). That changes exposure for new entrants and for entities transitioning into the regulated sector.

• The Crown. The Act expressly binds the Crown in each of its capacities (s 3). Where a trustee is the Crown or a public authority, the Crown is within scope and is legally subject to the levy.

• Entities in external Territories. The Act extends to each external Territory (s 4), so trustees of qualifying superannuation entities in those jurisdictions are within the levy regime.

Excluded or differently treated groups:

• Self managed superannuation funds. By definition the Act excludes SMSFs from being "superannuation entity" for the levy (s 5). The practical effect is that trustees of SMSFs are not directly liable under this Act for the supervisory levy that it imposes.

• Funds, trusts or schemes that are not superannuation entities under the SIS Act remain outside the standard levy net, but the Act explicitly defines "unregulated entity" for purposes of applying the levy calculation rules when such entities become regulated (s 5). That determines transitional liability rules for new entrants.

Who decides the operational parameters that affect all these actors? The Treasurer. The Act vests the Treasurer with power to determine, by legislative instrument, the percentages, maximums, minimums, and levy base methodology (s 7(3)). The Treasurer may apply different rules to different classes of superannuation entity and may make multiple determinations for a financial year (s 7(4A), (5)). Therefore trustees must follow annual determinations as to percentages, caps and basis.

Who collects the levy? The Act directs that the levy is payable in accordance with a specific subsection of another Act (s 6). That means collection and enforcement mechanics rest with the Financial Institutions Supervisory Levies Collection Act 1998 framework.

In sum, trustees of non‑SMSF superannuation entities, including trustees that are the Crown and trustees operating in external Territories, are the direct legal payers. New entrants are caught from the date they become regulated. The exercise of discretion by the Treasurer and the link to the levies collection Act determine administrative burdens and compliance pathways that these trustees must follow.

Duties established by the Act are targeted and procedural in nature, and most operational detail is delegated to the Treasurer’s legislative instruments and the separate levies collection statute.

Primary duties and legal obligations

• Liability to pay. Trustees of relevant superannuation entities are legally required to pay the supervisory levy payable for a financial year. The levy is imposed under the Act and declared payable in accordance with the collection Act (s 6, s 7(1)-(1B)). The legal duty is framed as an obligation on the trustee.

• Calculation compliance. Trustees must compute or accept the levy amount as the sum of the restricted and unrestricted components, calculated in the manner set out in s 7. That calculation relies in part on information about the trustee’s levy base and on annual parameters set by the Treasurer (s 7(1), (1A), (1B), (3)). The Act requires trustees to use the levy base as specified: normally the levy base on 30 June of the previous financial year, but with specified exceptions for entities that were unregulated or not in existence on that date (s 7(1A)-(1B)).

• Observe imposition timing and prorating. Trustees must observe the levy imposition day defined in s 5. If the levy imposition day is later than 1 July, the Act prescribes a formula in s 7(2) (presented as a formula in the Act) for working out a pro rata amount for that financial year.

• Follow Treasurer determinations. Because the Treasurer must, by legislative instrument, determine the restricted and unrestricted percentages, the maximum and minimum restricted levy amounts and the method of working out the levy base (s 7(3)), trustees have a duty to keep track of and apply those determinations. The Treasurer may make different provision for different classes of superannuation entity and may make multiple determinations within a financial year (s 7(4A), (5)).

Rights and constraints created by the Act

• Statutory cap constraint. The Act constrains the Treasurer’s determination of the maximum restricted levy amount by setting a statutory upper limit that the maximum must not exceed (s 7(4)). The statutory upper limit is numerically specified for the financial year commencing 1 July 2020 as $10,000,000 and is index‑linked in later years (s 5). That is a rights‑type constraint on administrative discretion.

• Right to know methodology. The Act requires the Treasurer to specify how a superannuation entity’s levy base is to be worked out (s 7(3)(d)). That gives trustees the right to a published, determinate method each year for calculating the levy base that determines their liability.

• Delegated rulemaking via legislative instrument. The statutory design delegates annual parameter setting to the Treasurer by legislative instrument (s 7(3)). Trustees therefore have the procedural right to rely on those instruments as the legal source of the percentages and caps for each year. The Act allows for different treatments across classes (s 7(4A)) and multiple determinations in a year (s 7(5)), which creates legal variability but also a clear locus for rights of review or challenge to specific determinations under the relevant administrative law framework, subject to the rules that apply to legislative instruments (the Act itself does not set appeal or review procedures).

• Interaction with CPI and indexation. Trustees have a rule‑based right to predict the statutory upper limit movements because s 8 prescribes the exact arithmetic by which the indexation factor is calculated from published CPI index numbers (s 8(1)-(3)). The rules specify the quarter to use (the most recent quarter for which the Australian Statistician has published an index number as at the start of the day the Treasurer first makes a determination), the divisor (the index number 12 months earlier), and an additive 0.030 adjustment (s 8(1)). Rounding rules are also prescribed to 3 decimal places with an upward adjustment if the fourth decimal place is more than 4 (s 8(2)).

Delegated obligations and informational duties implied but not spelled out

• The Act does not itself set specific reporting timelines, forms or penalty provisions for nonpayment. Collection and enforcement are to follow the Financial Institutions Supervisory Levies Collection Act 1998 (s 6). Trustees therefore have duties imposed by that collection statute, not by this Act, for payment timing and compliance enforcement.

• The Act requires the Treasurer to determine how a levy base is to be worked out (s 7(3)(d)). That implies trustees will need to provide whatever data is specified in the Treasurer’s instrument in order to calculate their levy base. The Act, however, does not list the specific data points, frequencies or verification standards.

In summary, the Act establishes the core payment duty on trustees, prescribes the structure for calculation and proration, requires annual Treasurer determinations of quantitative parameters, and provides a statutory ceiling that is index‑linked. Operational reporting, payment procedures and enforcement are provided through the separate levy collection statute and the Treasurer’s legislative instruments.

The Act itself is sparse on direct penalty and enforcement provisions and instead connects to external enforcement machinery. The statutory architecture separates liability creation from collection and enforcement.

Enforcement mechanism linkage

• Collection by reference to another Act. The Act imposes the levy and expressly states that the levy is payable in accordance with subsection 8(6) of the Financial Institutions Supervisory Levies Collection Act 1998 (s 6). The immediate legal consequence is that collection, payment timing, civil remedies for recovery, interest on unpaid amounts, and penalties for nonpayment are to be governed by the mechanisms and sanctions contained in that collection statute. This Act therefore creates the liability but delegates enforcement detail to the specified levies collection framework.

Absence of standalone penalty clauses

• No penalty clauses in the Act text. The Act contains no separate offences, infringement provisions, or specified administrative penalties in its own sections. There are no express infringement notices, criminal offences or specified civil penalties set out in this Act. The legal approach is to impose the levy and rely on the collection statute for enforcement mechanics.

Limits on the Treasurer’s monetary discretion with enforcement consequences

• Cap on maximum restricted levy amount. The Act constrains the Treasurer’s ability to set a maximum restricted levy amount by requiring that it must not exceed the statutory upper limit for the financial year (s 7(4)). From an enforcement perspective, that statutory cap is material because it sets a legal ceiling on amounts that the collection machinery may seek to recover as a maximum restricted levy in any given year.

Administrative discretion that affects compliance risk

• Multiple determinations and different classes. The Treasurer may make more than one determination for a financial year and may make different provision for different classes of superannuation entity (s 7(4A), (5)). That capacity increases the potential for complexity and compliance risk, because trustees must ascertain which determinations apply to them and ensure compliance with potentially multiple or class‑specific instruments. Enforcement actions under the collection Act could therefore be triggered by failures to apply the correct instrument.

Practical enforcement consequence for trustees

• Trustees are legally liable for the levy but must look to the collection statute for the precise enforcement framework. In practice, trustees should monitor the Treasurer’s legislative instruments for the year's parameters and the Financial Institutions Supervisory Levies Collection Act 1998 for payment procedures and default consequences. Because enforcement is through the other statute, the scope for administrative discretion in collection and remediation resides in that separate legal instrument, not in this Act.

Regulatory reach to government entities

• Binding the Crown. The Act binds the Crown in each capacity (s 3). Where trustees are governmental entities, the Crown is susceptible to whatever enforcement mechanisms are provided under the collection statute. The Act does not carve government entities out of enforcement.

In sum, the Act creates the levy liability and delegates collection and enforcement to the Financial Institutions Supervisory Levies Collection Act 1998, while placing a statutory cap constraint and giving the Treasurer flexible rulemaking power that can create compliance complexity. Trustees should therefore pay attention to both the Treasurer’s legislative instruments and the collection Act to understand potential penalties and enforcement processes that will apply in any given year.

This Act is minimal in length but designed to operate as a part of a broader statutory architecture. It explicitly imports definitions and links to other statutes for collection and for the operative regulatory population.

Interaction by imported definitions

• Superannuation Industry (Supervision) Act 1993 (SIS Act). The Act defines "superannuation entity" and "trustee" by reference to the SIS Act (s 5). That imports the SIS Act’s classification of regulated funds, trusteeship arrangements and the boundary between regulated superannuation vehicles and other arrangements. The practical effect is that the levy net mirrors the SIS Act’s regulated population, subject to the explicit exclusion of SMSFs in this Act.

• Classification consequences. Because the SIS Act governs who is a superannuation entity and who is a trustee, any change in regulatory status under the SIS Act (for example, registration, deregistration, or change in fund type) will directly affect levy liability under this Act. The Act codifies transitional rules when an entity becomes a superannuation entity during the year by reference to the levy imposition day (s 5; s 7(1A)-(1B)).

Interaction by collection reference

• Financial Institutions Supervisory Levies Collection Act 1998. The Act states that the levy is payable in accordance with subsection 8(6) of that collection Act (s 6). That imports the collection instrument for payment schedules, recovery procedures, interest on late payments, objection and review mechanisms, and any penalties or enforcement measures specified in the collection Act. The present Act therefore defers to that separate statute for procedural enforcement and collection detail.

Delegation and subordinate instruments

• Treasurer’s legislative instruments. The Act requires the Treasurer to determine the restricted/unrestricted percentages, maximum and minimum restricted levy amounts, and the method for working out the levy base by legislative instrument (s 7(3)). That makes the legislative instruments the operational rulebook for calculating the levy. The Act’s interaction with the law of legislative instruments and with procedural requirements for consultation and tabling of instruments will therefore be relevant in practice, since the annual parameters will be determined by such instruments. The Act permits multiple determinations and class‑based differentiation (s 7(4A), (5)), increasing the interface with the law governing legislative instruments.

• CPI and Australian Statistician publications. The indexation factor in s 8 requires use of the All Groups Consumer Price Index number, being the weighted average of the 8 capital cities, published by the Australian Statistician, and sets precise rules for which published index numbers to use (s 5 definition of "index number"; s 8). This creates an operational intersection with ABS publications and the methodology for CPI series. Changes in CPI reference periods, or substituted index numbers published by the Australian Statistician, are addressed in s 8(3).

Interaction with executive powers and regulations

• Commencement and regulations. The Act commences on commencement of the Australian Prudential Regulation Authority Act 1998 (s 2(1)), linking it to APRA’s establishment. Section 2(2) and s 9 empower the making of regulations by the Governor‑General for the purposes of s 2(2) to modify the Act’s effect in a financial year if it commences mid‑year. That interaction affects transitional application and timing.

Absence of direct interactions

• No tax or superannuation benefit amendments. The Act does not itself amend tax law, superannuation benefits, prudential rules, or trustee duties under the SIS Act outside of levy liability. Its functional interaction is therefore primarily definitional (via the SIS Act), procedural (via the levies collection Act), and operational (via Treasurer determinations and CPI data).

Overall, the Act is designed to sit within an existing statutory ecosystem: it borrows the SIS Act’s definitions to determine the population of obliged trustees, it delegates enforcement and collection to the Financial Institutions Supervisory Levies Collection Act 1998, it relies on legislative instruments for annual detail, and it depends on CPI publications for indexation calculations.

The Act text provided contains internal mechanisms for annual adjustment rather than a long set of amendments. The material in the source establishes an ongoing regime for annual determination of levy parameters and indexation, rather than recording a sequence of past amendments. Relevant provisions that affect how the Act evolves over time are these:

• Statutory upper limit specification and indexation. The Act specifies a numeric starting point for the statutory upper limit: $10,000,000 for the financial year commencing on 1 July 2020 (s 5 definition of "statutory upper limit"). For later financial years the statutory upper limit is subject to automatic indexation by multiplication by the indexation factor for the later financial year (s 5). The indexation factor calculation is fixed by s 8, which ties the factor to CPI movements plus an additive amount of 0.030, and sets rounding rules (s 8(1)-(3)). This embedded indexation formula is the Act’s built‑in mechanism for amendment by arithmetic rather than by formal amendment process.

• Annual Treasurer determinations. The Act expressly contemplates yearly change by mandating that the Treasurer determine, by legislative instrument, the maximum and minimum restricted levy amounts, the restricted and unrestricted levy percentages, and the method for working out a levy base for each financial year (s 7(3)). The power to make more than one determination for a financial year and to apply different provisions to different classes (s 7(4A), (5)) produces an avenue for annual or intra‑year variation without amending the Act itself.

• Commencement‑related regulation power. The Act allows the Governor‑General to make regulations for the purposes of s 2(2) (s 9), which gives the Executive a limited power to modify the Act’s effect in a financial year if the Act commences during that year. That is a mechanism for limited transitional modification at commencement.

What the Act does not contain as amendment history

• The text supplied does not list earlier statutory amendments, schedules, repeals, or historical notes. The Act’s own operative design is to provide an annually flexible levy regime through Treasurer determinations and indexation. Any further statutory amendments or historical chronology beyond the embedded indexation and the delegated determination powers are not contained within the text provided.

Practical consequence for practitioners

• Expect change by instrument not by amendment. The principal mechanism by which levy parameters will change over time is by the Treasurer’s legislative instruments and by the arithmetic indexation rule in s 8. Practitioners should therefore monitor annual legislative instruments for the financial year rather than expect frequent formal amendments to the Act text itself.

• Fixed anchor year. The Act’s anchor for statutory upper limit (1 July 2020) establishes a fixed calibrated cap that is then adjusted by the prescribed indexation factor. That approach reduces the need for frequent formal amendment to adjust the statutory upper limit number, but it does tie the cap to the indexation methodology codified in s 8.

This section therefore summarises the Act’s built‑in mechanisms for change and notes that the Act relies on delegated instruments and an indexation formula as its primary means of producing year‑to‑year variation in levy parameters.

The text of the Act supplied contains no judicial decisions, no references to litigation, and no citations of cases. The Act does not itself refer to any legal proceedings or to case law that interprets its provisions.

What the Act does provide that is relevant to litigation potential

• Delegated instruments and contestability. The Treasurer’s power to set percentages, caps and levy base methodology by legislative instrument (s 7(3)) creates points of potential administrative law challenge in practice. Although the Act offers no procedural guidance on review, legal challenges to specific Treasurer determinations would proceed under the ordinary administrative law and judicial review frameworks applicable to legislative instruments and executive decision making. The Act itself does not specify a privative clause or limit on judicial review.

• Classification disputes. Because the levy depends on whether an entity is a "superannuation entity" as defined under the SIS Act and because the Act treats some entities as "unregulated entities" for transitional purposes (s 5), disputes could arise in practice about whether a particular fund is within the SIS Act definition at a particular date. The Act’s use of the levy imposition day (s 5) and the fallback basis dates in s 7(1A) and (1B) create potential factual disputes that could be litigated under the SIS Act framework. The present Act, however, does not supply procedures for resolving such disputes.

• Application of collection Act. The Act defers enforcement and collection to subsection 8(6) of the Financial Institutions Supervisory Levies Collection Act 1998 (s 6). Any matters concerning enforcement, penalties, objections or recovery will engage the dispute and review provisions of that collection Act and associated administrative law. The Act itself does not provide a separate enforcement litigation route.

Absence of reported litigation in the source

• No reported decisions or judicial commentary. The Act text contains no record of litigation or case law. The supplied materials do not include any judgments, tribunal determinations or recorded disputes concerning interpretation or application of the Act.

For practitioners considering disputes or litigation risk, the relevant pathways and potential causes for judicial intervention are forecast by the Act’s delegation to legislative instruments, dependence on SIS Act classification, and reliance on the levies collection statute for enforcement. The Act’s text does not contain litigation history itself.

This Act is compact but contains several operational features that give rise to practical traps for trustees and advisers. The following points are concrete and derived directly from the statutory text.

1. Liability is on trustees of SIS‑defined superannuation entities, but SMSFs are excluded. The Act imports the SIS Act definition of "superannuation entity" while expressly excluding self managed superannuation funds (s 5). That means trustees of SMSFs will generally not be liable under this Act, while trustees of other regulated funds will be. A trustee that operates multiple structures should check classification for each entity separately.

2. New entrants and timing of registration affect the levy base date. If a fund was an unregulated entity, or not in existence, on 30 June of the previous financial year, then the restricted and unrestricted components use the levy base on the day the entity becomes a superannuation entity (s 7(1A)(a)(ii), s 7(1B)). Trustees should note that the levy imposition day is the day they become a superannuation entity if that is after 1 July of the financial year (s 5). That creates an exposure for entities that convert to regulated status within a year and can produce non‑linear levy obligations compared to entities that were regulated at 30 June.

3. The Act delegates key numeric choices to the Treasurer, not to the statute. The restricted levy percentage, unrestricted levy percentage, maximum and minimum restricted levy amounts, and the method for working out levy base are all set by legislative instrument (s 7(3)). The Treasurer may make different provision for different classes of superannuation entity and more than one determination in a year (s 7(4A), (5)). That delegation introduces year‑to‑year variability and class differentiation risk. Trustees must track the Treasurer’s instruments timely.

4. Maximum restricted levy amount is capped but by an index‑linked statutory upper limit. The Act requires that the Treasurer’s maximum restricted levy amount must not exceed the statutory upper limit for the financial year (s 7(4)). The statutory upper limit is $10,000,000 for the financial year commencing 1 July 2020 and is index‑linked thereafter (s 5). Practitioners should note that the cap constrains only the maximum restricted levy amount, not the unrestricted component or aggregate levy exposure per se. The Act does not expressly cap the unrestricted levy component.

5. The Act is silent on reporting, timing, collection processes and sanctions. The Act imposes the levy but expressly delegates payment and collection to another statute (s 6). Therefore trustees must consult the Financial Institutions Supervisory Levies Collection Act 1998 for payment schedules, late payment interest, objection routes and sanctions. Failure to do so can cause surprise enforcement action.

6. The indexation factor includes an additive 0.030 and specific rounding rules. Section 8 prescribes the precise arithmetic for indexation, including adding 0.030 to the CPI growth ratio, rounding to three decimal places with a possible upward adjustment (s 8(1)-(2)), and constraining which CPI series and published numbers may be used (s 8(3)). Small errors in interpreting the quarter to use or rounding can alter the statutory upper limit and therefore affect whether a Treasurer determination complies with s 7(4). Trustees and advisers should apply s 8 exactly.

7. The prorating formula for mid‑year imposition exists but is set out as a formula in the Act. Section 7(2) prescribes that if the levy imposition day is later than 1 July the levy is worked out using a formula (s 7(2)). The formula is presented in the text. Trustees whose entities become regulated during the year should apply that formula closely to avoid underpayment or overpayment.

8. The Act binds the Crown. Where trustees are government entities, the Crown is nonetheless bound (s 3). This means public bodies that are trustees are no different in liability under this Act from private trustees, subject to the practicalities of public sector settlement and collection mechanisms.

9. Different classes and multiple determinations complicate compliance. The Treasurer’s power to make different provision for different classes of superannuation entity and multiple determinations in a financial year (s 7(4A), (5)) can make the legal rulebook in any given year complex. Trustees need to confirm which determination applies to them and whether any subsequent determination alters their obligation.

10. External Territory extension and geographical coverage. The Act extends to each external Territory (s 4). Trustees and administrators with operations across the mainland and external Territories should check whether different determinations or application rules exist for funds domiciled in those territories.

These "gotchas" are direct consequences of the Act’s text and structure. They indicate areas where trustees and their advisers should pay attention to operational detail: the Treasurer’s determinations, the levy base methodology, commencement timing, the indexation arithmetic, and the collection Act’s procedures.

The Act concentrates operational responsibility on trustees and delegates key parameters to the Treasurer and the levies collection statute. Compliance therefore requires a small set of recurring activities tied to particular legal provisions.

1. Monitor Treasurer legislative instruments annually (s 7(3)). The Treasurer must, by legislative instrument, determine the restricted levy percentage, unrestricted levy percentage, maximum and minimum restricted levy amounts, and the method for working out a superannuation entity’s levy base each financial year. Because these determinations are the primary drivers of levy amounts, trustees must obtain and record the relevant legislative instrument for the financial year as soon as it is made. Note that the Treasurer may make multiple determinations and may apply different rules by class of superannuation entity (s 7(4A), (5)). Trustees must therefore identify which instrument(s) apply to them.

2. Identify whether your entity is a "superannuation entity" for SIS Act purposes and determine levy imposition day (s 5). The Act imports the SIS Act definition of "superannuation entity" and the trustee is the person who is trustee for SIS Act purposes. If the entity was a superannuation entity on 1 July of the financial year the levy imposition day is 1 July; if not, the imposition day is the day the entity became a superannuation entity. That date affects whether the levy is prorated under s 7(2).

3. Establish the levy base per Treasurer methodology (s 7(3)(d)). The Treasurer will prescribe how to work out the levy base. Trustees must calculate or provide the levy base as specified. Typically that will involve financial data as at 30 June of the previous financial year, unless the entity was unregulated or not in existence on that date, in which case the levy base is measured on the day the entity becomes a superannuation entity (s 7(1A)-(1B)). Ensure recordkeeping allows extraction of required levy base figures on the specified dates.

4. Apply the restricted and unrestricted component rules correctly (s 7(1)-(1B)). The levy equals the restricted levy component plus the unrestricted levy component. The restricted component is normally the restricted levy percentage multiplied by the levy base, subject to the maximum and minimum restricted levy amounts for the financial year. The unrestricted component is the unrestricted levy percentage multiplied by the levy base (s 7(1A)-(1B)). Calculate both components per the Treasurer’s percentages and caps.

5. Use the prorating formula if relevant (s 7(2)). If the levy imposition day is later than 1 July in the financial year, apply the formula provided by s 7(2) to compute the amount payable for that financial year. Trustees whose entities become regulated mid‑year must apply that prorating step when preparing levy calculations.

6. Check the statutory upper limit compliance for Treasurer maximums (s 7(4), s 5). Ensure that any maximum restricted levy amount published by the Treasurer does not exceed the statutory upper limit for the year. The statutory upper limit is $10,000,000 for the financial year commencing 1 July 2020 and is indexed thereafter by the indexation factor specified in s 8. Apply s 8’s CPI‑based arithmetic precisely when assessing or testing whether a Treasurer determination complies with the cap.

7. Attend to collection procedures and payment timing under the collection Act (s 6). The Act directs that the levy is payable in accordance with subsection 8(6) of the Financial Institutions Supervisory Levies Collection Act 1998 (s 6). Trustees must obtain the payment schedules, notice requirements, objection procedures, and default consequences from that collection statute and comply with its procedural steps for payment, dispute and remediation.

8. Maintain audit and recordkeeping trails. Because the levy relies on specific dates and base measures (30 June of the previous financial year or the date of becoming regulated), trustees should retain verifiable records for the levy base calculations, any correspondence or notices from the Treasurer, and evidence of payment under the collection Act. This will support compliance in the event of collection queries or disputes.

9. Consider class designation and intra‑year instrument changes (s 7(4A), (5)). Given the Treasurer may issue class‑specific or multiple determinations in a year, trustees should determine which class(es) their fund fits into and whether later determinations adjust earlier ones. Processes should be established to detect new instruments during a financial year.

10. Monitor CPI releases and indexation arithmetic for the statutory cap (s 8). The indexation factor is computed using the most recent quarter for which the Australian Statistician has published an index number as at the start of the day on which the Treasurer first makes a determination for the year (s 8(1)(a)). The calculation divides that index number by the index number for the quarter 12 months before and then adds 0.030 (s 8(1)(b)-(c)). The factor is rounded to 3 decimals with an upward adjustment rule (s 8(2)). Trustees and advisers should ensure that the persons performing indexation arithmetic use the correct index series (All Groups CPI, eight capital cities) and apply the rounding rule precisely.

11. Factor the levy into governance and budgeting. Trustees should bake the expected levy into operational budgets and member fee disclosures if the cost will be passed through to members by way of fees or lower net returns. The Act does not regulate whether trustees may pass the levy to members; that remains a matter of trust law, the fund’s governing rules, and other regulatory constraints under the SIS Act.

12. Coordinate with legal and compliance teams for public sector trustees and external Territories (s 3-4). The Act binds the Crown and extends to external Territories. Public sector trustees and trustees operating in external Territories should coordinate with in‑house counsel and finance teams to confirm budgetary treatment and payment logistics.

By performing these discrete steps each financial year trustees and their advisers will implement the Act’s obligations practically: obtain the Treasurer’s determinations, calculate the levy base per the prescribed method, compute restricted and unrestricted components with attention to caps and minimums, apply prorating when necessary, and remit payment under the collection Act.