Powered by momentummedia
nestegg logo
Powered by momentummedia
Powered by momentummedia
nestegg logo
nestegg logo

 

 

Retirement

Government extends early access to super scheme

  • July 24 2020
  • Share

Retirement

Government extends early access to super scheme

By Cameron Micallef
July 24 2020

Australians looking to access their superannuation early have been given an extra three months as the government extends the cut-off.

Government extends early access to super scheme

Government extends early access to super scheme

author image
  • July 24 2020
  • Share

Australians looking to access their superannuation early have been given an extra three months as the government extends the cut-off.

Government extends early access to super scheme

Members will now be able to access up to $10,000 if they have suffered financial hardships due to the COVID-19 pandemic until 30 December. 

When the scheme was first introduced, members who have been impacted financially by COVID-19 were allowed to withdraw $10,000 from their superannuation in the 2019-2020 financial year, and an additional $10,000 in the 2020-2021 financial year, until 24 September 2020.

Figures released earlier by the Australian Prudential Regulation Authority (APRA) have shown that 2.8 million Australians have withdrawn $28 billion from their pension fund. 

While early access to super has always been a feature for those experiencing severe financial hardship or accessing on compassionate grounds, the COVID-19 measure allowed individuals to apply as long as they experienced a reduction of working hours by 20 per cent or more.

Advertisement
Advertisement

The average payment made since inception sits at $7,718, and rises to $8,755 when considering repeat applications only.

The rules remain on the extension, with members accessing their superannuation will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink and Veterans’ Affairs payments, or the JobKeeper payment.

The ATO has since warned that it will take a closer look at applications to ensure the integrity of the scheme is upheld.

Who is eligible for the scheme

Eligibility to superannuation has not changed. Here are the ATO’s criteria for early access to superannuation:

To be eligible, a citizen or permanent resident of Australia and New Zealand must require the COVID-19 early release of super to assist them to deal with the adverse economic effects of COVID-19.

In addition, one of the following circumstances must apply:

  • You are unemployed
  • You are eligible to receive one of the following: JobSeeker Payment, Youth Allowance for jobseekers (unless you are undertaking full-time study or are a new apprentice) Parenting Payment (which includes the single and partnered payments), Special Benefit Farm Household Allowance

 On or after 1 January 2020, either:

  • You were made redundant
  • Your working hours were reduced by 20 per cent or more (including to zero)
  • You were a sole trader and your business was suspended or there was a reduction in turnover of 20 per cent or more (partners in a partnership are not eligible unless the partner satisfies any other of the eligibility)

Assessing your eligibility

You do not need to attach evidence to support your application. However, you should keep records and documents to confirm your eligibility as the ATO may ask you for this information. Examples of evidence to confirm eligibility may include your:

  • payslips
  • letters, emails or rosters from your employer
  • bank statements
  • business cash flow and turnover records
  • website or other public notice confirming your business closed
  • documents confirming eligibility for relevant government allowances or benefits (above)
  • separation certificate
Government extends early access to super scheme
Government extends early access to super scheme
nestegg logo

Forward this article to a friend. Follow us on Linkedin. Join us on Facebook. Find us on Twitter for the latest updates
Rate the article

About the author

author image

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

About the author

Cameron is a journalist for Momentum Media's nestegg and Smart Property Investment. He enjoys giving Aussies practical financial tips and tricks to help grow their wealth and achieve financial independence. As a self-confessed finance nerd, Cameron enjoys chatting with industry experts and commentators to leverage their insights to grow your portfolio.

more on this topic

more on this topic

From the web

Recommended by Spike Native Network

More articles

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.