The ATO has confirmed that applications to access super under the new compassionate ground – coronavirus condition of release can be made from 20 April 2020.

Eligible individuals can apply online via myGov to access up to $10,000 of their superannuation before 1 July 2020 (only 1 application allowed for the period).

You will also be able to access up to a further $10,000 from 1 July 2020 until 24 September 2020.

Eligibility:

To apply for early release you must satisfy any one or more of the following requirements:

  • You are unemployed.
  • You are eligible to receive a JobSeeker Payment, Youth Allowance for JobSeekers, Parenting Payment (which includes the Single and Partnered Payments), Special Benefit or Farm Household Allowance.
  • On or after 1 January 2020 if:
  1. You were made redundant, or;
  2. Your working hours were reduced by 20 per cent or more, or
  3.  If you are a sole trader — your business was suspended or there was a reduction in your turnover of 20 per cent or more.

 

Access

Applications are directed to the ATO using the myGov portal, website: www.my.gov.au. who will process and issue a determination with a copy to the Fund who will then release the money.

You will need to certify that you meet the eligibility criteria above relevant to your circumstances.

After the ATO has processed your application, they will issue you with a determination. The ATO will also provide a copy of this determination to your superannuation fund, which will advise them to release your superannuation payment. Your fund will then make the payment to you, without you needing to apply to them directly.

If your fund is a SMSF, you will need to let them know that you have received the determination so they can make the payment to you.

To read more: https://www.ato.gov.au/Individuals/Super/In-detail/Withdrawing-and-using-your-super/COVID-19-early-release-of-super/

 

Taxation

People accessing their superannuation will not need to pay tax on amounts released and the money they withdraw will not affect Centrelink or Veterans’ Affairs payments.

The ISSUE to consider – a balance between your cash flow need and your long term plan requires serious consideration.

It is not ideal to reduce your super as putting money back into super is regulated and fixed by various contribution caps.

So whilst this measure will provide assistance now it may have an effect on your long term plan.
Yes you can re contribute any unused amounts to your superannuation in the future (within your contribution caps).

https://treasury.gov.au/sites/default/files/2020-04/Fact_sheet-Early_Access_to_Super.pdf

Please call if you would like to discuss.
Adrian and the VJC Team

General Advice warning: the information in this article is general in nature, it is not advice specific to your needs. If you want to act upon the information in this article then you should seek advice from a qualified professional. VJC WM accepts no liability to any party for acting from this information unless they have sought advice in a formal engagement with VJC WM for this purpose.