Minimum pension payments

Account-based pensions are subject to annual minimum pension payments based on a fund member’s age and account balance. The minimum payment amount for a superannuation income stream (pension) is the account balance on 1 July (or account balance at start of income stream if a new income stream) multiplied by the percentage factor.

The percentage factor is is based on the beneficiary’s (recipient of income stream/pension) age on 1 July in the financial year in which the payment is made (or, if a new pension, the age of the beneficiary on commencement of the pension/income stream).

Set out below are all SuperGuide articles explaining Minimum pension payments.

Superannuation rates and thresholds for 2014/2015 year   Super Guide

For the 2013/2014 year, the concessional contributions caps for over-60s has jumped to $35,000, while the concessional cap for everyone else remains at $25,000.

SMSFs: Taking a lump sum from your super fund (5 Q&As)   Super Guide

Q: We have a SMSF with two members, both members having accumulation accounts and pensions. We understand that when you draw down pension amounts, the drawdown amount reduces the pension balance in accordance with the tax-free/taxable components, and any super contributions you make go into the separate accumulation account.

Retirement and tax: What are the minimum pension payment rules?   Super Guide

Q: I am 63. I want to retire next year but I am not sure if I want to access my super benefits yet. I have heard that when I retire, I must withdraw some super benefits each year, otherwise I won’t receive tax-free super benefits.

Minimum pension payment: At what date do you determine the age for payment calculation?   Super Guide

Q: I am drawing on an account-based pension from my SMSF. I turn 65 in June 2014. Will I need to draw a minimum of 4% or 5% for the 2013/2014 year?

SMSF pension: How do I calculate my minimum pension payment?   Super Guide

Q: I run our SMSF. I wish to retire at 55. I am a little confused about the 4% minimum rule for pensions. Do I have to withdraw 4% of my total accumulation SMSF fund, or do I move some of the assets into a pension fund and then draw 4% a year (or whatever the pension relief amount is)?

Minimum pension payments back to normal for 2013/2014 year, and for 2014/2015 year   Super Guide

When you start a superannuation account-based pension you must withdraw a minimum amount each year, based on your age and size of your account balance, to enable the earnings on your super pension account to be tax-exempt.

Super pensions: Is there an upper limit to how much we can withdraw?   Super Guide

Q: I am aware that the minimum amount of pension withdrawal is normally 4% (for under 65s) of the pension account balance (currently 3% for 2012/2013). Is there now any MAXIMUM amount of pension required to be drawn from a super fund?

Temporary pension relief is... temporary   Super Guide

Q: I wondered if a SMSF pension that was started at the relief rate of 3%, would it then have to increase to the 4% once the relief period expired, or would it remain at 3% because it was started at that rate?

SMSF pension payments: A little bit under is OK   Super Guide

SuperGuide often receives questions from readers asking what happens if they don’t withdraw the minimum pension amount required to be paid each year from their pension account.

Remember earlier Swan attack – freeze contributions caps and halve co contributions   Super Guide

In this article, we explain the super changes the government snuck through in November 2011 although Federal Treasurer, Wayne Swan, may be hoping that we forget his earlier tinkering with the super rules.