Managing pension payments

For payment frequencies other than fortnightly, payments will be drawn on or around the 15th day of the month, unless you elect otherwise. See How do I change my client’s pension payments below for more information on how to change your client’s pension payment date once the pension has commenced.

You and your client can pick a timeframe that best suits their needs. Pensions can be paid:

• fortnightly 
• monthly
• quarterly
• half-yearly, or
• yearly.

Please note, clients must take at least one payment per financial year in line with their minimum pension payment obligations.

For more information on making ad hoc pension payments, please refer to Making Adviser Initiated Payments from a pension account.

You need to update the nominated account using the Change of Account details form to change the destination of a pension payment for your client.

Only one nominated account can be selected to receive pension payments for each pension account.

If a payment is missed because of insufficient cash, you don’t need to wait until the next period or request the payment again.

To receive the pension, simply sell down investments in your client’s account until there is enough cash to make the payment. We’ll automatically make the payment to your client’s chosen account once there is enough cash.

Please note that if the account doesn’t have enough cash to meet the annual minimum pension requirements, we may need to sell down the assets on your behalf to ensure the minimum is met. Please refer to the relevant PDS for more information.

1. Log in to Adviser Online
2. Hover over Clients and click Accounts on the menu
3. Select your client’s Wrap account
4. Select Account details and go down to Pension details
5. Select Update recurring pension payments
6. Update the payment frequency, next payment date, payment amount and/or indexation
7. Once you’ve made at least one update, select Review
8. Confirm your updates and select Submit.
   • For advisers with ‘Ultimate’ security preference elected, you will be required to Authenticate the update to your client’s pension payments before the change is authorised.
9. Your Recurring pension payments update should be complete to view in Request Centre and will update overnight on the Account details screen.

You can amend the following payment details for your client:

1. Payment frequency
2. Next payment date
3. Payment amount
   
4. Indexation.

Pension update restrictions occur during the first week of July. This is known as the pension escalation period. Our Pensions team uses this time to calculate the minimum pension requirements for each pension account going into the new financial year.

You can find more information about the pension escalation period and other EOFY activities, in our EOFY Hub.

Because the accounts are being changed, we put restrictions in place to prevent certain actions from happening that could affect pension accounts. The following restrictions occur during pension escalation:

• No ad hoc pension payments
• No lump sum payments from a pension account
• No product switch applications to a pension
• No closing of a pension account. This is to avoid missing minimum legal requirements.
• No Pension Updates to commence.

Any requests made during this period will still be accepted. However, we won’t process them until after the escalation period.

Your client’s pension amount for the new financial year will depend on the new calculated minimum amount and the escalation indexation.

For Transition to Retirement pensions (TTRs), this will also be dependent on the TTR maximum drawdown amount for the account.

The escalation indexation process occurs in the first week of July each year and during this time payments cannot be amended online. The indexation options available are:

• None – No change to the current per payment amount. 
• Minimum – Client will receive the new minimum annual payment amount. Learn more about minimum pension payments.
• Maximum – Transition to retirement clients will receive the new maximum annual payment amount.
• CPI – Per payment amount will increase by the average of the last 2 quarters of consumer price index figures from the ATO.
• Fixed % – Per payment amount will increase by a fixed percentage that is selected.

If the indexed per payment amount results in the projected annual total being below the minimum annual payment amount, your client’s pension payments will be increased to the minimum required amount. 

For transition to retirement pensions, if the indexed per payment amount will result in the projected annual total being above the maximum annual payment amount, your client’s pension payments will be reduced to the maximum allowed amount. 

You can update your client’s regular Term Allocated Pension (TAP) account pension payments by emailing us a written request.

If you wish to take an ad hoc payment from a client’s TAP account, you can complete the Macquarie Super and Pension Withdrawal/Rollover form. However, the maximum amount that can be taken is limited to 110% of (or 10% higher than) the total annual payment amount of the TAP.