Early release of super
Individuals may be able to access their super if adversely affected by COVID-19.
From mid-April, eligible members can apply for a release of up to $10,000 of their super before 1 July 2020. They will also be able to access a further $10,000 from 1 July 2020 until 24 September 2020.
To apply for early release, the member must:
- be unemployed;
- be eligible to receive a jobseeker payment (previously called Newstart allowance), youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or
- on or after 1 January 2020, have been made redundant or had their working hours reduced by 20% or more or, if a sole trader, have had their business suspended or suffered a reduction in turnover of at least 20%.
If you are a member of an SMSF, you can apply through myGov from mid-April. If eligible, the ATO will issue a determination advising of your eligibility which you must pass on to the SMSF.
Tip! Use this measure as a last resort. Money taken from your super fund now will reduce the amount available once you retire.
Don’t forget SMSF trustees are responsible for the members’ retirement savings. If you are an SMSF trustee, please make sure the member is eligible for early release of super before you release any funds.
Reducing the minimum drawdown amounts
To assist retirees, the government has reduced the minimum annual payment required for account-based pensions and annuities, allocated pensions and annuities and market-linked pensions and annuities. The minimum amounts have been reduced by 50% for the 2019-20 and 2020-21 financial years.
If the minimum drawdown amount has already been paid, payments can be stopped for the remainder of the year. If you have received more than the minimum drawdown amount, you can recontribute these amounts if you are eligible to make superannuation contributions (subject to other rules or limits such as contributions caps).
Tip! Speak to your financial adviser before making any decisions affecting your super.
Ref: TaxWise Individual April 2020