As part of the new Economic stimulus in response to the COVID-19 pandemic, announced on 22 March 2020, early access to superannuation may be available to those affected by COVID-19.
Temporary Release of Superannuation
As part of the new Economic stimulus in response to the COVID-19 pandemic, announced on 22 March 2020 early access to superannuation may be available to those affected by COVID-19.
To be Eligible to apply for early release you must satisfy any one or more of the following:
- You are unemployed.
- You are eligible for job seeker payment, youth allowance for job seekers, parenting payment, 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.
You will be able to access up to $10,000 before 1 July 2020 and then a further $10,000 from 1 July 2020 for approximately three months.
Applications can be made from mid-April through the myGov website to the ATO.
The payments will not be taxable and will not affect Centrelink or Veteran affairs payments.
Temporary reduction of Superannuation minimum drawdown
This measure announced on 22 March 2020 is to reduce the need for retirees to sell superannuation fund assets to fund the minimum drawdown requirements.
The minimum drawdown on account based pensions and similar products has been reduced by 50% for the 2019/2020 and 2020/2021 years as follows:
|Age||Minimum Drawdown (%)||Reduced rate (%) for 2019/2020 and 2020/2021|
|65 – 74||5||2.5|
|80 – 84||7||3.5|
|90 – 94||11||5.5|
The upper and lower social security deeming rates are also being reduced by 0.75%.
YBM will provide further updates on social media and the website as they come to hand.
By Karen Bollinger – YBMYates Baker McLean. Accountants and Business Advisors situated in the Central West of NSW. Offering comprehensive advice for all your financial needs including tax, auditing, business advisory, self managed super funds, specialised industry experience and financial planning.