Early Release of Super
Can I withdraw my super early?
To have early access to your super, you would need to show your super fund that you are in serious financial hardship or have an illness and accessing money is essential.
All super funds contain conditions for early release and the ATO provides guidelines for release of funds on compassionate grounds.
Making a claim for early release of super
You don’t need a lawyer to make a claim for early release of super.
Most claims for early release of super are made via the ATO. However, a lawyer can ensure you have considered all entitlements you may have in your super fund.
Many people have TPD – total and permanent disability – insurance cover as part of their super and some have income protection insurance as part of their super.
Our team of experienced claims lawyers focus primarily on helping people with TPD Super Claims (total and permanent disability) super claims. We have helped hundreds of people secure their maximum super fund benefits in this way.
Whether you’re looking to start a claim, unsure if your injury or illness qualifies, or just after advice on your super benefits, get in touch today.
Early release of super
Superannuation is designed by the Australian Government to be accessed only after you reach retirement age. The ATO (Australian Tax Office) website explains in detail, the circumstances where super can be accessed early (you are under 60 years of age). Below is a summary of what appears on the ATO website
The ATO sets out specific circumstances when you can access your super early:
- Severe Financial hardship
- Compassionate grounds
- Permanent incapacity
- Temporary incapacity
- Terminal illness
- To assist in the purchase of your first home.
The ATO sets out specific circumstances when you can access your super early:
Severe Financial hardship
If you are experiencing severe financial hardship, you may be able to withdraw some of your super by making a claim to your super fund. There are also specific guidelines for this set out by the ATO.
Money withdrawn from your super fund, pre-retirement age, even though it’s due to financial hardship, will be taxed at the usual rate if you are under 60 years of age.
Compassionate grounds
The ATO website sets out when you can access your super early.
You can withdraw a portion of your super early on compassionate grounds to pay for:
- Medical treatment and transport for you or your dependant
- Modifications to your home or vehicle to accommodate you or your dependent’s special needs from a severe disability
- Palliative care for you or your dependant
- Death, funeral or burial expenses of your dependant
- To make loan repayments on your mortgage – to prevent foreclosure or forced sale of your home.
Applications are made online via the ATO website and not to your super fund and the super you withdraw is paid and taxed as a normal super lump sum.
Permanent incapacity
If you are permanently incapacitated, you may be able to access your super as a disability super benefit.
You must show that you have a permanent medical condition that is likely to stop you from ever working again in a job you were qualified to do by education, training or experience. You may still be able to withdraw some super and be working light duties in a different position or casually in a different field.
You can choose to receive your super as a lump sum or in regular payments as an income stream. Tax will need to be calculated and will depend on various factors. It will depend on whether you’re already receiving a disability payment and whether you’ve reached preservation age (that is, the retirement age where all people can legally access their super – this is usually 60 years of age).
If you’re permanently incapacitated and looking to withdraw your super, we can help.
Call us to speak to one of our experienced TPD Super Claims lawyers for free advice on your claim.
Temporary incapacity
You may be able to access super if you are temporarily unable to work or need to reduce your hours due to a medical condition.
You would receive the super in regular payments (an income stream) over the time you are unable to work. Payments from your super are taxed at the regular ‘income’ rate.
Claims for temporary incapacity payments should be made to your super fund.
It is a good idea to ask your super fund if you have income protection insurance as part of your super fund.
Terminal illness
You may be able to access your super balance early if you have a terminal illness. There are a number of conditions that must be met:
- Two doctors (one a specialist practising in the area related to your condition) need to certify that you suffer from an illness or injury that will likely result in your death within 24 months of the date of the certification.
- The 24-month certification period has not ended.
These payments are made as a lump sum. They are tax-free if you have a terminal medical condition either at the time of the payment of within 80 days of receiving the payment.
Claims can be made through your super fund or through the ATO.
Illegal release of super
You must have a valid reason to access your super balance early, before your preservation age.
Some promoters offer ‘early access’ by transferring your super into a self-managed fund. This is illegal and heavy penalties apply.
TPD Super Claims – We are no win no fee lawyers.
We are compassionate, experienced and committed to the efficient progression of your claim. Make an appointment to see one of our experienced injury claim lawyers sooner rather than later, to ensure your rights are protected.