Q: I am looking to access a part of my Superannuation as a result of losing my job last week. I am 48 and have a mortgage. How much can I draw and who do I apply to and what is the process?
A: In response to the coronavirus, the government is relaxing the requirements for accessing Superannuation before preservation age. Individuals who meet the eligibility criteria will be allowed to access to up to $10,000 in superannuation savings in both this financial year and next.
Eligibility requires any one or more of the following; unemployment; or eligibility to receive a job seeker payment, youth allowance for job seekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance; or redundancy on or after 1 January 2020; or a reduction to working hours of 20 per cent or more; or for sole traders, your business was suspended or there was a reduction in turnover of 20 per cent or more over the last six months.
Those eligible must apply to the ATO through the MyGov website and must self-certify that they meet the above requirements. The ATO will then process the application and issue a Determination to the applicant and their super fund. The super fund will be able to then pay the applicant directly. The ATO are yet to advise the procedure for SMSFs.
Those eligible may only make one application in each financial year. If the full $10,000 is not applied for this year, the member cannot subsequently apply for the balance remaining this year but may apply for the full $10,000 again next financial year.
Applications for early release of super under this measure are expected to commence from mid-April 2020, approval and benefit payment time frames have not been announced at this time.
Withdrawals will be tax free and will not affect Centrelink or DVA payments.
There are a range of other benefits you will most likely be entitled; the two $750 stimulus payments, the $550 a fortnight (for 6 months) coronavirus supplement and the Job seeker payment. Visit servicesaustralia.gov.au for further information on assistance packages.