EARLY ACCESS TO SUPERANNUATION
SUMMARY
Early access to superannuation of $10,000 this financial year and $10,000 next financial year.
POLICY
The Government is proposing to allow eligible individuals to access up to $10,000 of their superannuation before 1 July 2020. They may also be able to access up to a further $10,000 from 1 July 2020 to 24 September 2020.
To apply for early release, individuals must satisfy any one or more of the following requirements:
you are unemployed, or
you are eligible to receive a job seeker payment, youth allowance for jobseekers, parenting payment, special benefit or farm household allowance
on or after 1 January 2020
you were made redundant; or
your working hours were reduced by 20% or more; or
if you are a sole trader — your business was suspended or there was a reduction in your turnover of 20 per cent or more.
The individual will be able to nominate to make withdrawals from any or all of their open accounts, provided that the total amount to be withdrawn doesn’t exceed $10,000 per financial year. The ATO will be providing a list of the applicant’s superannuation accounts. However, the account balance shown will be as at 30 June 2019 and therefore not reflect more recent market movements.
Bank details will also be provided during the application process and passed on by the ATO to the super fund, eliminating any need for the individual themselves to provide this information to the super fund.
People accessing their superannuation will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink or Veterans’ Affairs payments.
Self Managed Super Funds. A similar process will apply for SMSFs. The ATO will issue a determination to the person and directly to the trustee of the SMSF advising them of the person’s eligibility to withdraw and the specified amount. Only then is a trustee authorised to make a payment.
Consideration should be given to underlying assets being sold, any insurance that is held (and ability to retain if appropriate) and enduring rollovers to fund premiums in other superannuation funds.
MORE INFORMATION
Refer to the following Treasury website page for more information:
Early access to superannuation (28Mar20)
HOW TO APPLY
Application via MyGov or by calling ATO, and anticipated to commence mid April. You are not able to apply directly to your superfund.