You may have seen our recent news story about the Federal Government announcing a temporary measure allowing your clients early release of part of their superannuation balance if they have been impacted by coronavirus.

What do I need to know?       

Eligible clients can apply to access up to $20,000 from their superannuation account tax free - $10,000 on or before 30 June 2020 and another $10,000 from 1 July 2020 until 24 September 2020.

To be eligible, individuals need to satisfy one or more of the following:

  • are unemployed
  • 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 they were either:
    • made redundant or
    • had working hours reduced by 20% or more or
    • are a sole trader whose business has been suspended, or had a reduction in turnover of 20% or more.

How do my clients apply?

From Monday 20 April 2020, your clients can log in to myGov and complete the application form available on ATO Online or call the ATO and complete their application over the phone.

It’s important to ensure your client has:

  1. their bank details ready as they’ll be required during the application process
  2. enough available cash in their account for the withdrawal
  3. determined if they should submit a notice to claim a tax deduction on personal contributions they may have made over the current and most recent financial years
  4. checked their myGov is displaying their current superannuation account correctly.

 

Warning Icon Orange It’s important to ensure your clients have enough available cash for this payment, should they be eligible to receive it.

If your client doesn’t have enough cash available to fund the withdrawal, we’ll initiate asset selldowns without seeking further instructions from you or your client. We’ll sell assets down based on information provided in the relevant Product Disclosure Statement (PDS).

If we need to sell assets on your client’s behalf, we’ll process the selldown within five business days after receiving the withdrawal request from the ATO.

Please consider insurance premiums when evaluating your client’s available cash balance.
 


How do we get notified by the ATO?

If the ATO approves your client’s application, they’ll send us the withdrawal instruction in an electronic data file within one to two business days.

How long does it take to process a withdrawal?

We’ll process all withdrawals as soon as we can, however, there could be a delay due to the high volume of requests that we expect to receive.

What if my client doesn’t have a sufficient account balance to fund the withdrawal?

Please ensure your client’s account balance is sufficient for this payment. If the balance is insufficient for the full payment, we’ll:

  • use the available balance to make a partial payment to the eligible client
  • draw the account balance to zero
  • keep the account open.

If we’re unable to complete the payment request either in part or in full, your client won’t be able to make a further claim to the ATO for the unpaid amount.

We're contacting your clients

We’re getting in touch with your clients to let them know about these product changes. 

Need help?

We’re committed to supporting you and your clients through this challenging and uncertain period. If you’d like to discuss the above or how we can provide ongoing support, please don’t hesitate to contact us on
1800 675 831 or email wrap@portfolioone.onepath.com.au.