While you generally can’t access your super until retirement, there are some specific circumstances where the law allows you to draw on your super early.
These conditions can be summarised as:
- Compassionate grounds
- Terminal medical condition
- Permanent incapacity
- Severe financial hardship
- Super less than $200
Also, you may be eligible for early access to your super under temporary new measures introduced by the Federal Government. These are relief measures to help deal with the adverse economic effects of COVID-19. Find out more at ato.gov.au
Before applying to access your super under early release provisions, please speak to your financial adviser or contact us
Compassionate grounds
You may be able to access your superannuation benefits on compassionate grounds where you don’t have the financial capacity to meet certain unpaid expenses, including:
- medical treatment for you or a dependant
- modifications to your home or transport, or disability aids required because of a severe disability suffered by you or a dependant
- mortgage payments or assistance to prevent the forced sale of your residential home
- palliative care expenses for yourself or a dependant, or
- expenses associated with the death, funeral or burial of a dependant.
Applications for early release of super need to be made to the Australian Taxation Office (ATO). Before making an application, you should confirm that your super fund is able to make payments approved under compassionate grounds.
Terminal medical condition
You may be able to access your super if you’re suffering from a terminal medical condition. You’ll be viewed as suffering a terminal medical condition if two registered medical practitioners certify that you suffer from an illness or injury that is likely to result in your death within 24 months. At least one of these medical practitioners must specialise in a field related to your illness or injury.
If you satisfy this condition of release, you can access the balance of your superannuation account at this time as well as any further benefits accrued within a period of 24 months.
Lump-sum payments released under this condition are tax-free within 24 months of certification.
Permanent incapacity
You may be able to access your super if you become permanently incapacitated.
You should check with your super fund to confirm what evidence is needed to satisfy this condition of release, as processes vary between funds. Generally, one or two registered medical practitioners will need to certify that due to your ill-health (physical or mental) you’re unlikely to engage in gainful employment for which you are reasonably qualified by education, training or experience.
If you satisfy this condition of release, you can withdraw all or part of your super as a lump-sum payment or use it to commence a superannuation income stream.
Severe financial hardship
You may be able to access your super if you’re having difficulty meeting reasonable and immediate family living expenses and you're receiving eligible Commonwealth income support payments.
If you’re under preservation age, you must have received Commonwealth income support payments for a continuous period of 26 weeks and be receiving these payments at the time of application. (You’ll need a letter from Services Australia confirming this.)
You’ll need to satisfy your super fund that you’re unable to meet reasonable and immediate family living expenses – ask your fund to confirm what’s needed to verify this.
You’re only able to receive one payment in any consecutive 12-month period.
The minimum payment before tax is $1,000 (or the balance of your super after tax if you have less than $1,000) and the maximum payment is $10,000.
If you have reached your preservation age plus 39 weeks, you must have received Commonwealth income support for a cumulative period of 26 weeks since reaching preservation age and not be gainfully employed on a full or part-time basis at the time of application.
You’ll need a letter from Services Australia confirming receipt of income support, and there’s no limit on the amount that can be released. This is paid and taxed as a normal super lump sum i.e. if you are over 60 years old you will not be taxed but under 60 years old is generally taxed between 17% - 22%.
What you need to know
Any advice on this website is provided by Resolution Life Australasia Limited ABN 84 079 300 379, AFSL No. 233671 (Resolution Life), and is general advice and does not take into account your objectives, financial situation or needs. Before acting on this advice, you should consider the appropriateness of the advice having regard to your objectives, financial situation and needs, as well as the relevant product disclosure statement and/or policy document, available from Resolution Life at Resolution Life or by calling 133 731, before making a decision on whether to acquire, or continue to hold, the product.
The Target Market Determinations (TMDs) for our financial products (where applicable) can be found at Target Market Determinations. The TMDs describe the key features and attributes of an applicable product that affect whether it is likely to be consistent with the objectives, financial situation and needs of consumers in the target market.
Resolution Life is part of the Resolution Life Group and can be contacted via Contact us or by calling the phone number mentioned above.
