Accessing super early: Living overseas and over the age of 55

Q: I’m an expat Australian, and I have been living in Singapore for quite a few years. I am 57 and I want to access my superannuation to buy a property. Is that possible? I have no idea if I will retire back in Australia or stay here, but my view is that if I do retire back in Australia, I will sell the property to fund my retirement.

A: I have divided your question into 2 questions:

1. Can I access my super at 57, if I am living overseas
2. Can I access my super to buy a property?

1.   Can I access my super at 57, if I am living overseas?

The rules relating to when you can access your superannuation benefits are fairly strict. You must satisfy a condition of release; the most popular conditions of release are retirement after preservation age (currently 55 years of age), turning 65, taking a transition-to-retirement pension or when you suffer severe financial hardship (hardship provisions don’t generally apply to individuals living outside Australia).

Specific rules regarding super access come into play when a fund member has reached their preservation age. Preservation age is currently 55 years (although steadily increasing to 60, depending on birth date), which means an individual can access super benefits provided they have retired from the workforce.

For an Australian living overseas, the rules are a little more complicated, although you should check the rules with your Australian super fund, or with the ATO.

Generally, an Australian living overseas, like Australians at home, who has reached the age of 55 can access his or her super benefits in Australia provided they provide documentary evidence to the fund that they have retired.

If an ex-pat is no longer a resident of Australia however, and aged 55 or over, I believe that provided the individual supplies documentation of overseas residency and that they are not employed in Australia, then super funds will consider releasing the super benefits, although super funds will generally still require some form of ‘retirement’ declaration. Again, you need to do your own research on your particular circumstances.

Note: Tax is generally payable on super benefits withdrawn before the age of 60.

You may find the following SuperGuide articles helpful:

• Accessing super early: 12 legal reasons to cash your super
• Retiring before the age of 60: the tax deal 
• Preservation age. I’m 58. Can I withdraw my super benefits?
• If I retire before 60, when can I access my super?

2.   Can I access my super to buy a property?

The answer to whether you can access your super to buy a property is, generally ‘no’. As I mentioned earlier in my response, the general answer is that you can only access your super if you satisfy a condition of release such as, retiring after your preservation age (currently 55), turning 65 or suffering severe financial hardship (subject to strict rules).

If you run a self-managed super fund (which is unlikely if you have been living overseas for an extended period), then there may be opportunities to purchase property within your super fund, but generally not for personal use. The only exception to personal use is where the property is a business-related property, such as an office, factory or shop, and then it may be possible to lease the property from your super fund.