When can you access super?

To answer the question – When can you access super? – we need to start with a couple of definitions: ‘Preservation Age’ and ‘Condition of Release’.

Preservation Age

Since superannuation was designed to encourage saving for retirement, your money in super is preserved (inaccessible) within the superannuation system until you reach the age that the government has deemed it accessible. That age is referred to as preservation age, which is now effectively 60 for everyone. Technically it is lower for people born before July 1, 1964, but as they have reached 60, it is effectively 60 for everyone.

Condition of Release

Reaching preservation age enables you to have met a condition of release to access your super. However, there are still restrictions to meet a full condition of release.

A full condition of release

This is where you can access all your super (either as an income stream by moving it to an account-based pension, or as a lump sum by withdrawing it directly).

The three possible full conditions of release for the purposes of retirement are:

• reaching ‘preservation age’ (60) and having retired;
• ceasing a gainful employment arrangement on or after age 60; or
• reaching 65 years of age, regardless of employment.

When you want to access your super to either withdraw it or move to an account-based pension (where there is zero tax to pay on investment earnings), you will need to fill out a form to submit to your super fund, which may be an electronic form, stating which condition of release you are eligible for.

Reaching ‘preservation age’ and having retired

If you access your super under this condition of release, you will have to sign a document with your super fund stating that you are retired and no longer intend to do full-time or part-time work. You can always change your mind later and work again.

Ceasing a gainful employment arrangement on or after age 60

If you access your super under this condition of release, you can cease any gainful employment arrangement after the age of 60, which can be moving from one employer to another, or even just ceasing a second job while continuing with your other job. You just need to make sure the work you cease qualifies as gainful employment under the superannuation law (the SIS Act), which means at least 10 hours per week.

Under this condition of release, if you go back to work, any super until that point remains accessible, but you will need to meet a new condition of release to access any future contributions.

If you met a condition of release and went back to work and are under age 65

If you go back to work and are under age 65, any super until the point you previously met a condition of release remains accessible, but you will need to meet a new condition of release to access any future contributions.

You also do not lose access due to not having notified them before going back to work. Contact them and they should be able to help.

A partial condition of release

There is also a partial condition of release where you have reached preservation age but have not met a full condition of release as above. This allows you to access up to a maximum of 10% of your super per year (using a TTR pension).

Non-retirement conditions of release

There are also non-retirement conditions of release.

• Permanent incapacitation – where your fund is satisfied you are unlikely to ever return to work again in an occupation you were qualified for based on your education, training or experience, you can generally access all your super.
• Temporary incapacitation – where your fund is satisfied you are temporarily unable to return to work due to illness or injury, you can generally access some of your super as an income stream. You cannot access your employer’s contributions or your own voluntary contributions, so this is generally only from the proceeds of any life insurance you have held through super.
• Terminal medical condition – this requires two doctors to certify you have an illness or injury that is likely to lead to death within two years, and at least one must be a specialist practising in the area related to your illness or injury.
• Severe financial hardship – allows you to access between $1,000 and $10,000 of your super if you have been receiving Centrelink support for a continuous period of 26 weeks and at the time of application to the super fund.
• Compassionate grounds – a major difference to the above is that you do not need to be on Centrelink payments. Compassionate grounds can include paying for:
  • medical treatment and medical transport for you or your dependents (partner or child)
  • palliative care for you or your dependant
  • making a payment on a home loan or council rates so you don’t lose your home
  • accommodating a disability for you or your dependent
  • expenses associated with the death, funeral, or burial of your dependant
• Terminating gainful employment with a super balance below $200 – if your super balance is below $200, you may withdraw that balance as a tax-free lump sum where you terminate gainful employment with an employer who has contributed to the super fund or if you have found a super account through lost super with a balance below $200. This is intended to avoid fees eating away at your balance.
• First Home Super Saver Scheme (FHSS) – this is a special condition of release to use some of your voluntary contributions to super to save for a first home purchase. It requires some planning, but if you are eligible, the tax savings are substantial.

Legacy super (pre–1999) – unrestricted non-preserved

This is for employment-related contributions (other than employer contributions) made before 1 July 1999.

Super has gone through many changes, and some older folks may have super that is ‘non-preserved’ (i.e., no requirement to meet preservation age), but access is restricted (inaccessible) until you cease work with that employer, and this is regardless of preservation age.

Accessing your super when leaving Australia

1. Citizens — you’re out of luck ^[1]

If you are a citizen, you can only access your funds for the same reasons as someone who still resides in Australia, which means reaching preservation age (which is now effectively 60 for everyone) or extenuating circumstances such as incapacitation, financial hardship, terminal illness, etc. This is to prevent people from taking what should be retirement savings and spending it frivolously and then returning.

Don’t forget that even if you cannot access it, it is still your money, and it will still grow if you make sure the money is invested there. Superannuation is an investment vehicle, meaning it is a structure that holds investments. So, be sure to do the following:

• Make sure it is in invested appropriately, which means being in a low-cost super fund with low-cost investments
• Make suer it is invested in the right amount of growth assets appropriate for your risk tolerance
• Turn off your insurance if it no longer suitable for your situation (f the insurance does not cover non-residents) to avoid these costs eating into your returns.

^[1] If you are a New Zealand citizen leaving Australia permanently, you can apply to transfer your super to a Kiwi Saver scheme under the Trans-Tasman Retirement Savings Portability Scheme.

2. Permanent residents – you may be able to access your super

Permanent residents are in the same situation as citizens in that they are unable to access their super until they reach preservation age (which is now effectively 60 for everyone).

However, there is a comment on the ATO Community website stating the following (note that DASP stands for Departing Australia Superannuation Payment):

We can confirm that it’s possible to apply for a DASP as a former temporary and permanent resident.
As for how to become a former permanent visa holder, we suggest you get in touch with the Department of Home Affairs.

A permanent resident has a permanent right to residency in Australia. It is the visa (the Resident Return Visa) that expires, not the permanent residency. So, even if you have left, you remain a permanent resident. But from the above comment, you may be able to cancel your permanent residency and access your super. ATO Community website representatives cannot be relied upon as a definitive source of information, and I have seen incorrect information from there before, but if you have left permanently, it may be worth looking into this.

Most importantly, however, is that even if you can access your super before preservation age, a significant portion of your super will be lost in tax. In the tax table shown here, most people’s super will be entirely “Taxable component – taxed element” (you can see that on your super statement). For working holiday makers, that means 65% lost in tax, and for everyone else, 35% lost in tax. This is a strong argument for just leaving it in super to compound and grow in a low tax environment until you reach preservation age.

3. Temporary residents — you can access it (with a significant tax hit)

If you were a temporary resident (not a permanent resident or Australian citizen), you’re able to access your super once your visa has lapsed and you’ve departed Australia.

To get the funds, you need to make a request to the ATO unless it has been only a short time, and you may be able to make the request directly from your super fund.

If a temporary resident does not apply to get their super within six months of having left Australia and with the visa ceased to be in effect, the super fund will transfer the super money to the ATO as unclaimed super money, where it will be earning no investment returns, so it doesn’t make sense to leave it there.

For more information, you can search Departing Australia Superannuation Payment (DASP)

In the tax table shown there, it will be “Taxable component – taxed element” for almost everyone, and for working holiday makers, that means 65% tax. Everyone else is taxed at 35%.

Summary – When can you access super

By now you should be able to answer the question of ‘When can you access super?‘

Here is a quick summary for your reference.

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