1. Giving Individuals Early Access to Their Superannuation
While superannuation helps people save for retirement, the Government recognises that for those significantly financially affected by the coronavirus, accessing some of their superannuation today may outweigh the benefits of maintaining those savings until retirement.
How much can you access if you are eligible?
Eligible individuals will be able to apply to access up to:
$10,000 of their superannuation before 1 July 2020;
- A further $10,000 from 1 July 2020 until 24 September 2020.
Who is eligible for the early release of superannuation due to coronavirus?
To apply for early release, you must satisfy one or more of the following requirements:
- You are unemployed.
- You are eligible to receive a job seeker payment, youth allowance for jobseekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance.
- On or after 1 January 2020, either
- You were made redundant;
- Your working hours were reduced by 20% or more;
- If you are a sole trader, your business was suspended or there was a reduction in your turnover of 20% or more.
There is no requirement that you are already receiving Commonwealth income support payments and there is no waiting period. In addition, there are no income or assets tests. For example, even someone with a very high salary who remains employed and has other assets could access this payment as long as their working hours have been reduced by 20% after 1 January 2020.
How to apply for an early release of superannuation due to coronavirus?
Applications for early release of superannuation will be accepted through myGov from 20 April 2020.
You can register your interest with the ATO now by logging in to your myGov account
and following the Intention to access coronavirus support instructions. If you don’t already have a myGov account, you can set one up by selecting 'create an account'. The ATO will notify you by email or SMS when applications open.
If your application is successful, the ATO will issue a determination evidencing your eligibility. Importantly you must not access your superannuation before the ATO confirms your eligibility and approves your application.
Are there any adverse consequences if I choose to withdraw this payment?
The following table summarises the potential consequences of this payment on your other interests:
||None. You will not need to pay tax on amounts released due to coronavirus.
|Social Security Payments
||None. The money you withdraw due to coronavirus will not affect your Centrelink or Veterans’ Affairs payments.
Life / Total Permanent Disability.
|Possible. Insurance may not be available if you fully withdraw your superannuation or your superannuation balance reduces to less than $6,000. Consider whether you need to seek financial advice before submitting your application to the ATO.
What documentation does ESUPERFUND require if I withdraw this payment?
If you access your superannuation under this special provision, you will be required to provide a copy of the ATO’s determination for audit purposes as part of the checklist completion process.