Whether you employ a handful of subbies or have hundreds on your payroll, ACIRT gives your workforce the peace of mind they need to remain happy and loyal.
Everything you need to know
ACIRT provides the following benefits to employers:
- It provides a vehicle that allows employers to fund their employee’s redundancy entitlements monthly, rather than as a lump sum on termination of employment. In addition, monthly payments to ACIRT are a deductible tax expense and not subject to Fringe Benefits Tax (FBT).
- It provides for contribution flexibility. Employers can pay the minimum contribution necessary to fund the award redundancy entitlement, or they can elect to make higher contributions to provide employees with higher redundancy entitlements, as agreed to between the employer, relevant unions and employees through enterprise agreements. By funding monthly, employers can manage cash flows and budget this expense into their job costs.
- Employee entitlements are secure in the event the employer becomes insolvent because these contributions are held by the Trustee on behalf of all employees/members. Former employees can claim their full accumulated account balance on termination of employment.
- Large employers who have a Payroll Tax liability will benefit because ACIRT contributions are not classified as ‘wages’ in all states except WA.
Employers who wish to join ACIRT must complete the Deed of Adherence and agree to the Trust Deed terms and conditions. Essentially, on receipt of the completed Deed of Adherence, our administrator will issue a welcome letter that provides the applicant with a unique participating employer number and a contribution return. Employers can elect to receive a monthly paper contribution return or become an ‘Online Employer’.Deed of Adherence Trust Deed
Employer Access is our online portal that allows employers to process their monthly contributions in-house, add and remove members and obtain instant member numbers online. To use this facility you must register with the fund administrator where your company will be given an individual user ID and password.
For more information refer to the ACIRT E-Business Booklet.E-Business Booklet
This term refers to monthly contributions due to ACIRT which are unpaid.
As an example, contributions due to XYZ P/L for a particular month are payable on or before the 14th day of the following month. If the contributions are unpaid by the 20th day of the following month, they will be listed as an outstanding contribution (arrears) on the following month’s return.
ACIRT pays fees to its directors to compensate them for their time spent in managing the fund. The fee payable to directors is currently $3,354 per meeting. Directors who are members of board sub-committees are entitled to be paid $1,118 for each Committee meeting.
The Constitution provides that the level of director’s fees is adjusted annually by the Consumer Price Index.
Where agreed between the sponsoring organisation and the individual directors, those fees may be paid directly to the sponsoring organisation (including any applicable GST).
Where we consider appropriate, the fund may also advertise in the journal or magazine of a sponsoring organisation. These payments are always made on an independent basis.
Redundant is defined in the Trust Deed as:
‘The termination or cessation of employment of the member for any reason.’
Upon the member providing the administrator with a completed Benefit Claim Form (including supporting information e.g. separation certificate etc., payment is made direct to the member, either by cheque or Electronic Fund Transfer (EFT).
Employers should note that if the amount contributed on behalf of an employee into ACIRT is less than the Award entitlement, the employer will have a ‘shortfall’ amount which must be paid directly to the employee on termination.Benefit Claim Form
Redundancy obligations apply to all employers and employees covered by the following modernised awards, which came into effect on 1 January 2010:
- The Building and Construction General On-Site Award 2010, and
- The Plumbing and Fire Sprinklers Award 2010
In fundamental terms, this means that any employer covered by the provisions of the above awards as at 1 January 2010 will need to make provision for redundancy benefits regardless of the number of employees engaged. Basically these ‘modern’ awards replicate the redundancy scales found under the National Building and Construction Industry Award 2000. That is, a maximum of 8 weeks pay after 4 years of employment.
The choice by employers is whether to fund this minimum obligation monthly into ACIRT, or accrue internally until the employee is made redundant.
How does this affect employers?
It depends on your circumstances. If your company has a registered Industrial instrument, the redundancy obligations are defined. If your company does not have a registered Industrial agreement, it nevertheless has a redundancy obligation from 1 January 2010. It should be noted that these awards do not distinguish between ‘small’ or other employers in regard to the liability to pay redundancy.
The Trustee has current class tax rulings from the Australian Taxation Office (ATO) that confirm the following:
ACIRT is a trust estate that will be subject to Division 6 of the Income Tax Assessment Act 1936 (ITAA36).
Employer redundancy contributions to the Trust are allowable deductions under subsection 8-1 of the Income Tax Assessment Act 1997 (ITAA97). The Fund has been prescribed in regulation as an Approved Worker Entitlement Fund. This is important because any employer contributions to a fund that is not ‘approved’ will result in a taxable fringe benefit and thus taxed under the provisions of the Fringe Benefits Tax Assessment Act 1986 (FBTAA). Employer contributions to ACIRT are not subject to FBT.
The trustee has obtained a ruling from the New South Wales Office of State Revenue that confirms employer contributions to ACIRT do not attract Payroll Tax.
ACIRT offers several different methods of processing contribution returns and payments via our website or electronically:
- BPay – we can provide you with the ACIRT biller code and your unique reference number
- Cheque – made payable to ACIRT
- Electronic Funds Transfer (EFT)
- Direct Debit
Refer to our booklet to see how our online portal, Employer Access, can help your business.
All forms relating to Employers can be easily found here.