Q: I am 57 years old, born 1953. I thought I could access my super funds from age 55 but I have been told I can’t access my funds until age 60. Is this correct? If I withdraw my super benefits, is there any tax payable?
Trish’s response: The general rule is that you must have reached your preservation age and retired, or satisfy another condition of release to access your super benefits. The preservation age for an individual who was born in 1953 (and anyone born before July 1960) is age 55, not age 60.
You have reached your preservation age but if you don’t intend to retire then you must satisfy another condition of release to be able to access your benefits. Examples of some of the more common conditions of release are:
- starting a transition-to-retirement pension (TRIP) which means that an individual doesn’t have to retire to access super benefits as an income stream, provided the individual has reached preservation age
- reaching the age of 65
- resigning or otherwise leaving a job on or after the age of 60
I explain the conditions of release in my article 12 legal reasons to cash your super.
Tax on super benefits
Tax is usually payable on super benefits withdrawn before the age of 60, although a person’s tax bill depends on the structure of an individual’s super benefits and personal tax situation. If you’re a public servant then you may have more tax on your super benefits (if your super benefits come from what is known as an untaxed source). I explain how super benefits are taxed when withdrawn before the age of 60 in my article Retiring before the age of 60: the tax deal.