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Access to early release of superannuation

Date:
By  Stephanie Oakley

If you have been financially affected by COVID-19 you can access up to $10,000 of your superannuation in 2019–20 and a further $10,000 in 2020–21.

You will not need to pay tax on amounts released and the money withdrawn will not be taken into account for any income or means tests.

Eligible individuals who wish to access the early release of super for COVID-19 can do so from 20 April 2020. You must apply via ATO Online through myGov to access:

  • $10,000 of your superannuation by 30 June 2020 
  • a further $10,000 between 1 July 2020 and 24 September 2020. [now extended to 31 December 2020 -  fact sheet]

You can request amounts up to a total of $10,000 from multiple funds per application per income year.

An application cannot be varied once it is submitted but can be revoked if there is an error or mistake.

 

Eligibility

To be eligible for early release of super, a citizen or permanent resident of Australia and New Zealand must be in one of the following circumstances:

  • You are unemployed.
  • You are eligible to receive one of the following
    • jobseeker payment
    • youth allowance for jobseekers (unless you are undertaking full-time study or are a new apprentice)
    • parenting payment (which includes the single and partnered payments)
    • special benefit
    • farm household allowance.
  • On or after 1 January 2020 either
    • you were made redundant
    • your working hours were reduced by 20% or more (including to zero)
    • you were a sole trader and your business was suspended or there was a reduction in turnover of 20% or more.

Temporary residents may also be eligible for the early release of super. 
You need to assess your eligibility accurately, read here for more information on eligibility.
 

Banking information

Your bank account details will be collected in the application process, the bank account to receive payments will not default to your tax return account.
If the super money is held by the ATO, the money will have to be rolled over to an active super fund before you can request the release of funds under this early release process.
 

Implications of accessing your super early

Accessing your super early will affect your super balance and may affect your future retirement income. Withdrawing superannuation may also affect your income protection insurance and life/total permanent disability insurance cover.

You should consider whether you need to seek financial advice before submitting your application for the early release of super.

During the COVID-19 pandemic ASIC has permitted registered tax agents to give advice to existing clients about early access to superannuation.

If you require any advice we have financial advisers, accountants and a SMSF team who can help you, contact us.

 

NOTE: please either apply for the early access to superannuation yourself or speak to your trusted accountant or adviser as there are a number of scams currently targeting people in this area. See here for more information.

 

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