The Government has introduced a package of measures to provide assistance to eligible individuals financially impacted by the Coronavirus (COVID-19) including the temporary early release of super, a single payment of up to $10,000 in both the 2019/2020 and 2020/2021 financial years. Read more about the relief here.
Clients can now submit applications via the ATO to request a payment of up to $10,000 in the 2019/2020 financial year.
Here are some points to consider if you have clients wishing you to access their super.
To help us process early payment requests as quickly as possible, please consider whether any of your clients who wish to make a withdrawal have sufficient cash available in their transaction account.
If a client does not have sufficient cash in their account to cover the withdrawal amount, we will trigger a drawdown based on the client’s existing default strategy. This may delay the payment of the withdrawal to clients.
We will waive the standard minimum account balance and will provide as much of the requested amount to the client as possible. We will estimate the tax liability for the account and that will be the only funds reserved.
For these clients we will also turn off administration fees and any advice fees. These will be turned on again when a contribution or rollover is received into their account.
If the early release payment does not leave a sufficient amount in their account to cover insurance premiums, your client’s policy may be at risk of lapsing. Please ensure there is a sufficient amount in your client’s account for future insurance premiums if they would like to maintain their insurance policy.
If you have clients who were intending to claim a tax deduction for some of their personal contributions made to the account during the current or previous financial year, they may need to lodge a ‘Notice of intent to claim or vary a deduction for personal super contributions’ form to confirm their intent to claim a tax deduction for those contributions before the early releases payment is processed.
If the redemption request is received from the ATO and actioned prior to receipt of this intent to deduct notice, the client may not be able to claim a deduction for some or all of the contributions that have been made.
Eligible citizens and permanent residents of Australia or New Zealand, as well as eligible temporary residents may apply if they meet the criteria below.
Eligibility info from ATO can be found here:
To apply for this, your client must satisfy any one or more of the following requirements:
At the time of application, they were:
On or after 1 January 2020:
If your client is eligible, they’ll be able to access a single payment up to and capped at $10,000 of their super in the 2019/2020 financial year and similarly, another single payment in the 2020/2021 financial year. They can apply for any amount up to $10,000 in each financial year and these withdrawals will be tax free. Applications for the 2020/2021 financial year will cease from 24 September 2020.
Clients can now apply to the ATO via myGov for early release of superannuation.
The ATO will consider each application and advise if it’s approved or declined. For approved applications, the ATO will provide a copy of your client’s application to their nominated super fund, and a payment will then be made by the super fund to your client. Your client must apply directly to the ATO via myGov and not their super fund.
Members of an SMSF are also able to apply via myGov. The ATO will issue approved determinations to your client When your client’s SMSF receives the determination, they will be authorised to make the payment.
Your client’s current super account balance may be lower or higher than what is shown in myGov. The amount shown in myGov is the amount last reported to the ATO. This typically represents the account balance as at the previous 30 June.
Your clients can apply for an amount higher than the balance shown in myGov (up to $10,000), provided their current balance is sufficient. This includes if a 'nil' amount is showing. For example, if you or your client has confirmed that their account balance is $8,000, but the amount showing in myGov is $0.00 they can still apply for a release up to $8,000.
Information current as at 16 April 2020.
This communication has been prepared for use by advisers only. It must not be made available to any client and any information in it must not be communicated to any client. This document provides an overview or summary only and it should not be considered a comprehensive statement on any matter or relied upon as such. This information does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness, having regard to these factors before acting on it.
BT Portfolio Services Ltd ABN 73 095 055 208 AFSL 233715 (BTPS) administers Panorama Super. BT Funds Management Limited ABN 63 002 916 458 AFSL 233724 (BTFM) is the trustee and issuer of Panorama Super, which is part of Retirement Wrap ABN 39 827 542 991. Westpac Financial Services Ltd ABN 20 000 241 127 AFSL 233716 (WFSL) is the responsible entity and issuer of interests in BT Managed Portfolios. BTPS operates Panorama Investments. Westpac Banking Corporation ABN 33 007 457 141 AFSL and Australian credit licence 233714 (Westpac) is the issuer of the BT Cash Management Account (BT CMA) and the BT Cash Management Account Saver (BT CMA Saver). Together, these products are referred to as the Panorama products. In addition, BTPS is the provider of the Panorama SMSF Establishment Service and the Panorama SMSF Administration Service. The Guide and Terms and Conditions for these services are available by contacting BTPS. BTPS administers BT SuperWrap Personal Plan, SuperWrap Pension Plan, BT SuperWrap Open Pension and BT Compact SuperWrap Pension (collectively, SuperWrap Products). BTFM is the trustee of Retirement Wrap and issuer of SuperWrap Products. BTFM is the trustee and issuer of Asgard eWRAP Super/Pension, Asgard Infinity eWRAP Super/Pension, Asgard Open eWRAP Pension, Asgard Infinity eWRAP Pension, Asgard Managed Profiles and Separately Managed Account – Funds Super and Asgard Elements Super (collectively, Asgard Products). Asgard Capital Management Limited ABN 92 009 279 592, AFSL Number 240695 (Asgard) is the administrator and custodian of the Asgard Products.
A Product Disclosure Statement or other disclosure document (PDS) for the Panorama products and the SuperWrap products can be obtained by contacting BT on 1300 783 143 or by visiting bt.com.au. A PDS for the Asgard Products can be obtained by contacting Asgard on 1800 731 804or by visiting asgard.com.au. A retail client should obtain and consider the relevant PDS before deciding whether to acquire, continue to hold or dispose of interests in a Panorama product, SuperWrap product or Asgard Product.
BTPS, BTFM, Asgard and WFSL are subsidiaries of Westpac. Apart from any interest investors may have in Westpac term deposits, Westpac securities, the BT CMA, or the BT CMA Saver acquired through the Panorama operating system, an investment acquired using the Panorama operating system or an Asgard Product or SuperWrap product is not an investment in, deposit with or any other liability of Westpac or any other company in the Westpac Group. These investments are subject to investment risk, including possible delays in repayment of withdrawal proceeds and loss of income and principal invested. Westpac and its related entities do not stand behind or otherwise guarantee the capital value or investment performance of any investments acquired through the Panorama operating system or any investments in, or acquired through, Asgard generally or through a SuperWrap product.
Superannuation is a means of saving for retirement, which is, in part, compulsory. The Government has placed restrictions on when you can access your investments held in superannuation. The Government has set caps on the amount of money that you can add to your superannuation each year and over your lifetime on both a concessional and non-concessional tax basis. There will be tax consequences if you breach these caps. For more detail, speak with a registered tax agent or visit the ATO website.
Each of BTPS, BTFM, WFSL and Westpac cannot give tax advice. Any tax considerations outlined in this document are general statements, based on an interpretation of current tax laws, and do not constitute tax advice. As such, you should not place reliance on any such taxation considerations as a basis for making your decision with respect to the product.
This information may contain material provided by third parties derived from sources believed to be accurate at its issue date. While such material is published with necessary permission, the Westpac Group accepts no responsibility for the accuracy or completeness of, nor does it endorse any such third party material. To the maximum extent permitted by law, we intend by this notice to exclude liability for this third party material.