If your clients have been impacted by coronavirus (COVID-19), they may be eligible for a Temporary Early Release of Superannuation, a measure recently announced by the Federal Government.
What do I need to know?
Eligible individuals can apply to access up to $20,000 from their superannuation account tax free - $10,000 before 30 June 2020 and another $10,000 from 1 July 2020 until 24 September 2020.
Your clients will be able to apply online from April through the myGov website. The Australian Tax Office will assess these applications and issue a determination. These determinations will be provided to superannuation funds, who’ll then make payments directly to the individual.
To be eligible, individuals need to satisfy one or more of the following:
- must be unemployed or in receipt of eligible government assistance or
- on or after 1 January 2020 were:
- made redundant or
- had working hours reduced by 20% or more or
- sole traders who saw their business suspended or had a reduction in turnover of 20% or more.
You’ll need to make sure that any eligible client has a sufficient cash balance in their account before we can make the payment. We’re encouraging members to talk to you, their financial adviser, before or at the time of applying to release their super, in case you need to sell any assets on their behalf to fund the payment. Please note, not doing so may delay our payment.
It’s important that your clients understand that withdrawing from their superannuation early may affect the availability of funds for their retirement. Please speak to your clients about the impact this may have on their retirement savings.
We’re committed to supporting our members 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.