ADVISER USE ONLY. In specie transfer guidelines

Transcription

1 ADVISER USE ONLY In specie transfer guidelines Issued 17 January 2012

2 About Strategy your leading platform solution The Strategy wrap platform is a comprehensive wrap administration service across superannuation, retirement and investment that allows you to efficiently tailor a wealth creation solution for your clients. You can transact, record and report on a diverse range of investments within superannuation, pension service and non-super investment portfolios. Strategy also allows you to conveniently package together investments, such as direct shares, managed funds, property trusts and term deposits, to provide a seamless solution for you and your clients. With Strategy, the hard work is done, allowing you more time for new business and client service. About Oasis Asset Management Limited Strategy s administrator, Oasis Asset Management Limited (OAM) is a specialist wholesale platform provider and integral to OnePath. OAM offers a complete range of customised platform services for securities dealers, financial advisers and investors. Their focus is on delivering quality platform administration, excellent client service and market leading front office software with integrated risk management.

3 Contents Overview 2 In specie transfers in super and pension division 4 In specie transfers in portfolio service 6 In specie transfers out portfolio service 8 Frequently asked questions 9 Glossary 10 1

4 Overview This guide is designed to assist you with the in specie transfer process. The guide should be read in conjunction with the relevant in specie transfer form, as well as the current offer documents for the products your clients hold. In specie transfer forms, Australian Standard Transfer Forms (ASTFs) and ASTF examples are available on If you have any further queries, please contact Client Services on What is an in specie transfer? A process of transferring managed investments or listed securities without selling the underlying asset. Which products accept in specie transfers? Retirement fund In specie in of approved listed securities and managed investments into both the super and pension division. In specie out of assets is not available at this stage. If your client wishes to withdraw from the super and pension division, they will need to sell down assets to cash prior to withdrawing. Portfolio service In specie in and out of approved listed securities and managed investments where there is no change in beneficial ownership (refer to the Glossary for examples of change of beneficial owner and no change of beneficial owner). Employer and personal plan In specie transfers are not available for these products. Which investments can be transferred? Managed investments Generally, only investments currently on the investment authority listing are able to be transferred onto the platform for both the super/pension division and portfolio service. Listed securities The super and pension division can only accept listed securities that are on the approved security list which is currently based on the ASX 200, and certain exchange traded funds (ETFs). The portfolio service can accept all fully paid listed securities which are tradeable through CHESS. What are the CGT implications of the transfer? Super and pension division There will be CGT implications of transferring the assets into the super and pension division as there will be a change in beneficial ownership. Portfolio service Transfers that do not involve a change in beneficial ownership will not have any CGT implications. We currently only offer transfers to the portfolio service that do not involve a change in beneficial ownership. What are the benefits of an in specie transfer? Combining investments onto one platform saves time by providing consolidated reporting. In specie transfers do not expose the clients to out of market risks generally associated with selling and repurchasing investments. When there is no change in beneficial ownership, transfers are able to take place without the realisation of capital gains. Only applies to transfers to and from the portfolio service. Fees and charges Super and pension division At this stage there are no fees for transferring managed investments into the super and pension division, however, stamp duty will be deducted from an investor s account if applicable. Refer to page 3 for more information on stamp duty payable. For each listed security being transferred, there will be a transfer fee of $25.63 per asset. This fee is for transferring listed securities from one account (HIN) to another. Portfolio service An amount of $61.50 per asset is charged for both managed investments and listed security transfers when transferring in or out of the portfolio service. Note: The fees quoted in this guide are gross of GST and net of any Reduced Input Tax Credits (RITCs). 2

5 What should be taken into consideration? Ensure that the fund you are transferring from allows transfers out. Potential CGT liabilities. Potential stamp duty liabilities. An in specie transfer can be a lengthy process due to the number of parties that are involved. If transferring from another platform, confirm with the other provider what is required to complete the transfer from their end. If managed investments or listed securities are due to receive distributions or dividends, these should be completed prior to commencing the transfer. Be aware that corporate action eligibility and acceptance may be negatively impacted by the transfer (this applies to listed securities only). Cash account In order to avoid a sell down of assets upon transfer, there must be sufficient cash in an investor s account. This is applicable for both new and existing investors. The cash account must hold: enough funds to cover stamp duty and costs, and the minimum cash account requirements (refer to the relevant PDS or IDPS guide for these levels). In the case that there is insufficient cash to cover stamp duty and costs, a sell down of assets will take place. In situations where investors only hold managed investments that do not price daily, the transfer cannot commence until sufficient funds have been received into the cash account. GST Generally, an in specie transfer of managed investments or listed securities has no GST consequences. We recommend that you seek your own professional tax advice in relation to the potential GST implications arising from any in specie transfer. Stamp duty Where there are transfers of managed investments, these transfers may be subject to stamp duty at the time of transfer. Whether or not the transfer is subject to stamp duty and the amount of duty, will depend on a number of factors including the State or Territory of incorporation of the relevant investment vehicle (e.g. trust) and whether there is a change in beneficial ownership as a result of the transfer. The transfer of shares or units in a unit trust scheme, that are quoted on the Australian Securities Exchange or a recognised stock exchange are not subject to stamp duty. For further information in relation to the application of stamp duty and the current rates of stamp duty in all Australian States and Territories please refer to: /pages/stampduty.aspx Note: Stamp duty laws and rates of duty are subject to change and the implications may depend on your individual circumstances. As such, we recommend that your clients seek their own professional tax advice in relation to the potential stamp duty implications arising from any in specie transfer. 3

6 In specie transfers in super and pension division Before you commence the transfer process, check: that we can accept the assets that you are transferring for your client the diversification limits, contribution caps and eligibility to contribute legislation must be taken into consideration where the fund cap contribution limit is exceeded, the transfer will not proceed until resolved if rolling over from a self-managed super fund the member needs to ensure that they are in a position to provide us with a Rollover Benefits Statement (RBS) within 30 days of us receiving the funds if you need to sell down any assets, arrange this sale prior to commencing the in specie transfer that all forms are accurately completed as any incomplete/incorrect information will delay the process, and if rolling over from another platform, it should be ensured that there is provision for the transfer of any cash the member may hold on that platform. What documentation is required? Below is a list of documentation required. All documentation must be received and completed correctly for the transfer to proceed. Application form (for new members) As well as the application form, ensure all documentation for a new account is included as detailed in the application checklist in the PDS. Any missing information may result in a delay with the commencement of the transfer. Remember to provide any additional cash that is required to avoid a sell down of assets. This applies to new and existing members. Share trading access form If transferring shares, and the member does not already hold shares on the platform, you must complete an investor share trading access form for the member to receive a HIN. Note: As an adviser you must also have authority to trade. These forms and a guide to trading are available at In specie transfer to super form All relevant sections of the in specie transfer form must be completed. Any missing requirements may result in a delay of the commencement of the transfer. Australian standard transfer IN form (listed securities) and/or Australian standard transfer IN form (managed investments) You must complete one form for each listed security and each managed investment being transferred. The forms are available on with examples attached to the form to assist you in completing the ASTF. How you fill out each form depends on whether the assets are held directly or through another platform. Examples of how to complete are attached to the form. Please contact Client Services if you are unsure how to complete. Current holding statement (listed securities) A current holding statement is required from the issuer of the securities showing the member s current holding. If the listed securities are held through another platform, a current statement from them will be sufficient. Copy of Statement for Managed Investments Rollover Benefits Statement (RBS) or Component details Attach a copy of a statement from the current wrap account, IDPS operator or fund manager showing the current holdings of the managed investments that are to be transferred. If the transfer is a rollover, we must receive an RBS within 30 days for the preservation and components to be updated to reflect the RBS. If we do not receive an RBS within the 30 days the preservation and components will be defaulted as follows: Preservation Preserved Component Taxable If the transfer is a contribution, you must inform us at the time of initiating the transfer what the components are to be. Failure to do so will result in the transfer being processed as member non taxable. 4

7 Transfer steps for in specie transfers in super and pension division Documentation to be completed and sent to: 1 Adviser Strategy Superannuation In specie Transfers Locked Bag 1000 Wollongong DC NSW Strategy/ Adviser We receive documentation. If documentation is not correct, adviser will be notified and transfer will not commence until the correct documentation is received. 3 Strategy New account set up by us and cash deposit processed if applicable. Member will receive a new HIN, where applicable. 4 Strategy ASTFs are signed and processed accordingly by our custodian. 5 Custodian Confirmation received Custodian arranges transfer of listed securities and/or managed investments and confirms to Strategy. Processing of transfers 6 Strategy Listed securities and/or managed investments will be processed on our system. Details of the contribution/rollover* will be entered into the system. Fees and costs will be charged at this stage, including stamp duty. 7 Strategy Confirmation to member The member will receive confirmation of the transfer, with a copy being sent to the adviser. * RBS details must be received within 30 days of confirmation of funds. 5

8 In specie transfers in portfolio service Before you commence the transfer process, check: that we can accept the assets that you are transferring for your client if you need to sell down any assets, arrange this sale prior to commencing the in specie transfer if there is enough money in the cash account to avoid a sell down of assets once the transfer has taken place. Refer to the Strategy Portfolio Service Information and Financial Services Guide for the cash account minimums. if the assets are held on another platform, confirm with the other provider what is required to complete the transfer from their end. What documentation is required? Below is a list of documentation required. All documentation must be received and completed correctly for the transfer to proceed. As well as the application form, ensure all documentation for a new account is included. Application form (for new investors) Any missing information may result in a delay with the commencement of the transfer. Remember to provide any additional cash that is required to avoid a sell down of assets. This applies to new and existing investors. Share trading facility and adviser authority If transferring shares, and the investor does not already hold shares on the platform, the share trading facility and adviser authority form must be completed for the investor to receive a HIN. Note: as an adviser you must also have authority to trade. These forms and a guide to trading are available at In specie transfer to the portfolio service form All relevant sections of the in specie transfer form must be completed. Any missing requirements may result in a delay with the commencement of the transfer. Australian standard transfer IN form (listed securities) and/or Australian standard transfer IN form (managed investments) You must complete one form for each listed security and each managed investment being transferred. The forms are available on with examples attached to the form to assist you in completing the ASTF. How you fill out each form depends on whether the assets are held directly or through another platform. Examples of how to complete are attached to the form. Please contact Client Services if you are unsure how to complete. Tax parcel history (mandatory) Current holding statement (listed securities) Copy of statement for managed investments For future accurate capital gains tax reporting, a tax parcel history must be completed for each listed security and/or managed investment being transferred. If it is not provided, we are unable to proceed with the transfer. To assist you in providing this information, the cost base spreadsheet is available on Instructions for completion and submission are contained within the spreadsheet. You can also provide the tax parcel history in another format such as an unrealised gains report. A current holding statement is required from the issuer of the securities showing the investor s current holding. If the listed securities are held through another platform, a current statement from them will be sufficient. Attach a copy of a statement from the current wrap account, IDPS operator or fund manager showing the current holdings of the managed investments that are to be transferred. Margin lending If you have margin lending on your portfolio service account, any in specie transactions on your account must be approved by your margin lender. You can either contact the margin lender directly or we will contact them on your behalf to approve the transactions. 6

9 Transfer steps for in specie transfers in portfolio service All documentation to be completed and sent to: 1 Adviser Strategy Portfolio Service In specie Transfers Locked Bag 1000 Wollongong DC NSW Strategy/ Adviser We receive documentation. If documentation is not complete or correct, adviser will be notified and transfer will not commence until the correct and complete documentation is received. 3 Strategy New account set up by us and cash deposits will be processed if applicable. Investor will receive a new HIN, where applicable. 4 Strategy ASTFs are signed and processed accordingly by our custodian. 5 Custodian Confirmation received Custodian arranges transfer of listed securities and/or managed investments and confirms to Strategy. 6 Strategy Processing of transfers Listed securities and/or managed investments will be processed on our system. Fees and costs will be charged at this stage. 7 Strategy Confirmation to member The member will receive confirmation of the transfer, with a copy being sent to the adviser. 7

10 In specie transfers out portfolio service In specie transfers out are only available from the portfolio service for transfers where there is no change in beneficial ownership. Only whole assets are able to be transferred (it can be a partial account balance transfer but not partial assets). Before you commence the transfer process, check: that the other provider/fund manager will allow an in specie transfer of the investment with the other provider/fund manager for any of their form requirements to complete the transfer there is enough money in the cash account to cover the $61.50 asset transfer fee that will apply per asset. What documentation is required? Below is a list of documentation required. All documentation must be received and completed correctly for the transfer to proceed. In specie transfer out form This is the instruction to Strategy to in specie out the investor s assets to their nominated destination. Transfer steps for in specie transfers out All documentation to be completed and sent to: 1 Adviser Strategy Portfolio Service In specie transfers Locked Bag 1000 Wollongong DC NSW Strategy/ Adviser We receive and process documentation. If documentation is not complete or correct, adviser will be notified and transfer will not commence until the correct and complete documentation is received. 3 Strategy Reinvestments and all regular facilities are disabled (for full transfers only). 4 Strategy Strategy will generate ASTFs for the transfer and send to our custodian for signing. 5 Buyer Once our custodian has signed the ASTFs we will onforward to the buyer for them to finalise the transfer. It is important to note that the buyer will need to arrange stamp duty (where applicable) in order to finalise the transfer. Once stamp duty has been paid (if applicable) it is the responsibility of the buyer to forward the ASTF to the appropriate registry in order to finalise the transfer. 6 Custodian Our custodian will provide confirmation of transfer of listed securities and/or managed investments. 7 Strategy Cash portion will be forwarded to the other institution or as nominated in your form. 8 Strategy We will close the account. A confirmation letter will be sent to the investor, with a copy being sent to the adviser. 8

11 Frequently asked questions Why does the in specie process take so long? The process of transferring assets is dependent on a number of parties. The speed of the overall process is dependent on third parties, particularly the existing operator, the Offices of State Revenue, fund managers, custodians and CHESS. Why are the ASTFs so complicated? ASTFs can be confusing to complete if you are not familiar with them. The examples that are attached to the form on should provide you with some guidance. If you are still unsure, please contact our Client Services team who will be able to guide you through the process as any forms not completed correctly will not be able to be processed by third parties. This means we will have to reject and new forms will be required. If a member wants to commence an allocated pension from their super account, do they need to complete the in specie forms? No. If your client wishes to transfer to a pension account (assuming they meet the criteria) please complete the super to pension transfer form which is available on the MoneyOne website. Need more information? Business development Contact your Business Development Manager Client Services Why are the originals required for ASTFs? As the original ASTFs are required by the Offices of State Revenue, individual fund managers and custodian, we will reject any ASTFs that are not originals. What transfer date should I use on the ASTF for transfers into super? The seller is able to nominate the transfer date for transfers into super as there is a change in beneficial ownership. The transfer date nominated can be retrospective, but it must be within the three months preceding the receipt of paperwork in our office. The transfer date cannot be prior to your client s account start date. Can amendments be made to ASTFs? Amendments can be made to ASTFs but any alterations must be initialled by both the buyer(s) and seller(s). The use of correction fluid or tape will render the ASTF invalid. As well, any increase to the units being transferred is not acceptable, even if initialled. Why do you only accept no change in beneficial ownership (NCBO) transfers into and out of the portfolio service? We only have functionality to transfer NCBO transfers in and out of the portfolio service at this stage. 9

12 Glossary ASTF ASX Beneficial ownership CBO Australian standard transfer form An ASTF for each listed security and/or managed investment is required. These are available from the website as well as examples of how to complete. Australian Securities Exchange The beneficial owner of an asset is the one who ultimately benefits from an interest in an asset. Change in beneficial ownership A CBO occurs when the beneficial owner of assets changes from one individual or entity to another. A transfer that results in a change of beneficial ownership will generally have taxation and stamp duty implications. These changes can affect the current and the new owners of the asset. Examples 1. Lee Smith transferring to Kylie Smith. 2. Lee Smith transferring to Lee Smith and Kylie Smith ATF The Smith Family Fund. CHESS Direct holdings HIN Issuer sponsored NCBO Clearing House Electronic Sub-register System CHESS performs two major functions for the ASX. It facilitates the clearing and settlement of trades in listed securities, and provides an electronic sub-register for shares in listed companies. When managed investments are held directly with the fund manager rather than with an external custodian. Holder Identification Number When listed securities are held directly with the issuer. Example: John Smith holds 100 ANZ shares held with ANZ rather than via a wrap account. No change in beneficial ownership. When assets are transferred from one account to another without any change to the beneficial owner. Examples 1. Alex Smith external custodian account to Alex Smith Strategy Portfolio Service the beneficial owner is still Alex Smith, just through a different custodian. 2. Alex Smith to Alex Jones (nee Smith) this is merely a change in name upon marriage, not a change in beneficial owner. RBS Stamp duty Rollover Benefit Statement This is required when rolling into the super and pension division. The Australian Taxation Office (ATO) website has information on how to complete the RBS if you need further information. Duty imposed on certain transactions and instruments (e.g. transfers of unlisted securities) in each Australian jurisdiction. The quantum of duty or whether it applies varies depending on the jurisdiction. Please refer to: or your professional accountant for more information and current rates. 10

13 Contact details Client Services Available Monday to Friday (other than national public and banking holidays) 8.30 am 6.00 pm (Eastern Standard Time) Telephone: Facsimile: (02) Website: Strategy Retirement Fund and Strategy Portfolio Service Locked Bag 1000 WOLLONGONG DC NSW 2500 Trustee Oasis Fund Management Limited 347 Kent Street, Sydney NSW 2000 ABN AFSL Administrator Oasis Asset Management Limited 347 Kent Street, Sydney NSW 2000 ABN Disclaimer: The issuer of this information is Oasis Fund Management Limited (ABN , AFSL , RSE L ) (OFM) as Trustee and Operator of the Strategy Retirement Fund and Strategy Portfolio Service. These products are administered by Oasis Asset Management Limited (ABN ). The material contained in this flyer is general information only for the use of advisers only and may not be reproduced without the issuer s prior written permission. This material is current as at 10 January 2012 but may be subject to change. Before using this service or making any investment decision based on the information contained therein, a potential investor should consider the appropriateness of the service having regard to their objectives, financial situation and needs and read the relevant Product Disclosure Statement/Financial Services Guide (as applicable) as well as the terms and conditions for the use of Money One Online which are available at or by calling Client Services. MoneyOne is a registered trade mark of moneyone.com.au Limited (ACN ).

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