Early release of super for illness or injury

When illness or injury is keeping you from working or you have a terminal illness, it is important to know you may be able to draw on your super to help alleviate financial stress at such a difficult time for you and your family.

There are three conditions of release that are specifically designed for you to access super when you are sick or injured. They are temporary incapacity, permanent incapacity, and having a terminal medical condition. Understanding them will help you assess which you are likely to be eligible for.

Temporary incapacity

You’re temporarily incapacitated (according to Australian super legislation) if physical or mental ill-health causes you to stop work temporarily.

If your fund is satisfied you are temporarily incapacitated, they are permitted to pay you a regular income to continue the wages you were receiving before you stopped work. This income can’t be more than you were earning before and must stop when you make a full return to work.

If you are receiving a temporary incapacity benefit and return to work at reduced hours, you may receive a partial payment until you’re able to return to your full hours.

The law doesn’t allow temporary incapacity benefits to be released from the part of your super that has come from your employer’s compulsory contributions or from your (member) contributions. This means that the payment must come from:

• Income protection insurance held in the fund, or
• Other amounts held in your fund such as additional employer contributions above the super guarantee* and fund reserves.

*Additional employer contributions include your salary sacrifice. Salary sacrifice is treated as an employer contribution in super law.

Permanent incapacity

If your fund is satisfied that your physical or mental ill-health makes it unlikely you will return to an occupation your education, training or experience makes you suitable for, your super can be released using the permanent incapacity condition of release.