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An important consideration when dealing with superannuation is the access or withdrawal of your benefits/entitlement from your superannuation fund.  Generally speaking, superannuation can only be accessed once you retire or reach retirement age.  However, it is possible to access superannuation early, that is, before retirement, but there is a strict criterion that needs to be satisfied.  In addition, there may be penalties imposed if you illegally access superannuation early so it is important to access superannuation in a manner that complies with the law to avoid any fines and penalties that may be imposed.  Obtaining holistic legal advice from an experienced Superannuation and Taxation Lawyer can assist you in accessing your superannuation.

Firstly, there are certain conditions of release stipulated by superannuation law that need to be satisfied before superannuation benefits can be accessed from a fund.  If you have a regulated superannuation fund, your benefits may include preserved benefits (PBs), restricted non-preserved benefits (RNPBs) and unrestricted non-preserved benefits (UNPBs). Generally PBs and RNPBs must be preserved until the member satisfies a condition of release as specified by superannuation law. For example, PBs and RNPBs must be retained in the fund until a member’s “retirement” on or after attaining his/her preservation age (or until the member satisfies another condition of release with no cashing restriction). A member’s preservation age varies between 55 and 60 years, based on his/her birth date. Where a relevant condition of release is satisfied and no cashing restriction applies, a member’s benefits may be paid in a lump sum or pension form, or both.  A member’s PBs and RNPBs in a superannuation fund (or ADF) can only be accessed (“cashed”) if a condition of release is satisfied.

The conditions of release (which include early release) include: retirement, terminal medical condition, post-preservation age non-commutable income stream, permanent incapacity and temporary incapacity, termination of employment, temporary resident permanently departing Australia, severe financial hardship, compassionate grounds, former lost members with small benefits and release of benefits under ATO release authority. Obtaining legal advice from a qualified Superannuation and Taxation Lawyer can inform you of whether or not you satisfy a condition of release to access your superannuation or whether you can access it early.  Sound financial advice can also assist you in the timing and structure of accessing these superannuation benefits to ensure that they meet your financial goals that may include, tax minimisation, lump sum withdrawal, or benefits paid into an income stream.

Secondly, payments of superannuation benefits to members that do not comply with the conditions of release are not treated as superannuation benefits, and will be taxed as ordinary income at the marginal tax rates of members. There may also be penalties imposed for accessing superannuation benefits without satisfying a condition of release. This may include criminal penalties, penalties and interest charges. Obtaining professional legal advice from a qualified and experienced Tax and Superannuation Lawyer can assist in ensuring that your early access of superannuation benefits complies with superannuation law and minimises any tax or penalty that may be applicable.

If you would like further information or wish to discuss your superannuation withdrawal matter with our experienced legal and financial staff please do not hesitate to contact us by telephone on (02) 9233 4048 or by email to info@navado.com.au. 

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