The Government has released a second major economic rescue package to help the economy withstand and recover from the economic impact of coronavirus (COVID-19). Included in this package were two measures in relation to superannuation.
COVID-19 Economic Stimulus – Superannuation Measures
The Government has released a second major economic rescue package to help the economy withstand and recover from the economic impact of coronavirus (COVID-19). Included in this package were two measures in relation to superannuation:-
1. Reduction in minimum pension requirements
The significant losses in financial markets as a result of COVID-19 have had a negative impact on superannuation balances.
To assist those who are drawing pensions, the minimum pension requirements will be halved in the 2019-20 and 2020-21 financial years. The minimum pension factors for each age group will be as follows:
|
Age |
Minimum % withdrawal (in all other cases) |
Reduced rates by 50% for the 2019-20 and 2020-21 income years (%) |
|
Under 65 |
4% |
2% |
|
65–74 |
5% |
2.5% |
|
75–79 |
6% |
3% |
|
80–84 |
7% |
3.5% |
|
85–89 |
9% |
4.5% |
|
90–94 |
11% |
5.5% |
|
95 or more |
14% |
7% |
(Source: ATO website)
2. Giving eligible taxpayers early access to their superannuation
Taxpayers who meet certain eligibility requirements will have early access to their superannuation savings of up to $10,000 this financial year (2019/20) and $10,000 next financial year (2020/21). If you are eligible, you will be able to apply online through MyGov.
To apply for release, you must satisfy any one or more of the following:
- You are unemployed
- You are eligible to receive a job seeker payment, youth allowance for jobseekers, parenting payment, special benefit or 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
If you wish to discuss your eligibility for these measures or have any questions, please contact our offices in Camden and Wollongong on (02) 4601 1000.
Product Disclaimer:
This is general information only. No investment advice has been provided to you. The information in this blog is general information only and has been prepared without taking into account your personal objectives, financial information and needs. You should consider any advice in this blog in light of your personal objectives, financial situation or needs before acting on it. You may wish to consult an accountant and or licensed financial adviser to do this. Hailston + Co assumes no responsibility for any actions you take independently, and without seeking professional advice from your accountant or licensed financial advisor.
