Q: If I start a Pension in my SMSF after 1 July 2023 with a Transfer Balance Cap (TBC) at $1.9 million and Transfer Balance Account (TBA) at $1.9 million (but do not take a Pension payment until after 1 June 2024,) does it means that I do not have to use any of my 4% minimum pension drawdown for the 2023-24 year? If that is the case, does my total balance account increases by the earnings allocated to my Pension Account as at 1 July 2024? If the above is correct, how does this affect my tax-free status of earning in Pension Account for the 2023-24 year? I am assuming the tax free status remains in place?
A: I think this is probably a really good opportunity to give some assistance in regard to general advice around this question, but also a good opportunity to explain some of these concepts in more detail. If you’re listening and going, What is this all about? Hopefully I can unpack some of these issues.
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