You can access your super when you have retired and reached your preservation age, which is anywhere between the age of 58 and 60, depending on your date of birth. Once you reach the age of 65 you receive unrestricted access to your super. In certain circumstances you can access your super benefits earlier than your preservation age, such as in cases of severe financial hardship or permanent disability.
In an accumulation and Transition to Retirement (TTR) account, investment earnings and capital gains are taxed at a maximum rate of 15%. Some capital gains may be taxed at the concessional rate of 10%. In a Retirement account, investment earnings are tax-free.
|
Aged over 60 |
Aged under 60 |
TTR account (pension payments only) |
Tax-free |
Marginal tax rate (plus the Medicare levy), with a 15% offset |
Retirement account |
Tax-free |
Tax-free* |
*Withdrawals from a retirement account are generally tax free, however tax may apply when you withdraw a total amount above the low rate cap (currently $230,000 for 2022/23 financial year) from super, before you reach the age of 60. The low rate cap is indexed annually. For up to date low rate cap information please visit ato.gov.au.
A Transition to Retirement account allows you to continue to grow your super even after you reach preservation age and are still working. You can only access your super in the form of an income stream, which is capped at a maximum of 10% of the 1 July balance each financial year.
For the 2019-20 to 2022- 23 financial years, the minimum pension payment has been reduced by 50% of the standard pension rate as part of the government’s response to COVID-19.
If you're aged between 67-74, you no longer need to satisfy a ‘work test’ before making non-concessional contributions and salary sacrifice contributions to your superannuation.
However, to claim a tax deduction on a personal contribution, you will still need to satisfy the work test requirement. Refer to the ATO for eligibility requirements.
You also have from age 67 to the year you turn 75 to bring forward non-concessional contribution caps if the total super balance and remaining contribution cap allows it.
Your superannuation doesn’t automatically convert to a pension when you reach retirement age. You generally need to instruct your superannuation provider on what you would like to happen, and you have a range of options for this. Some Australians may choose to take their superannuation savings as a lump cash sum for their bank account, while others transfer their money to retirement products like an account-based pension (also known as an allocated pension) to provide a regular income stream from the money saved in their superannuation.
The maximum amount you can hold in a retirement phase product like an account-based pension is $1.7 million. For some, this may mean that you retain much of your savings within the accumulation environment instead.