Once you hit age 75, your super fund is generally unable to accept further contributions into your super account (see more details below).
You can contribute to your super at any time up to age 74, even if you're not working. If you want to claim a tax deduction for your personal contributions you'll need to meet the work test, or work test exemption rules.
If you're between 65 and 74 and still working, the rules around employer-paid super contributions don't change. Generally speaking, from 1 July 2022, you're eligible to receive super from your employer if you are aged over 18. It doesn't matter if your job is permanent, or casual.
If you are 75 years or older, the super fund cannot accept any voluntary (concessional and non-concessional) contributions from you apart from mandated (super guarantee) employer contributions which can be contributed at any time regardless of age.
If you want full access to your super balance when you reach 60, you will need to fulfill one more condition; an employment arrangement coming to an end. You can then access the money as an account-based pension income stream, a lump sum withdrawal, or a combination of both.
Super is a great way to save money for your retirement. It is generally taxed at a lower rate than your regular income. You typically pay 15% tax on your super contributions, and your withdrawals are tax-free if you're 60 or older.
You can withdraw your super: when you turn 65 (even if you haven't retired) when you reach preservation age and retire, or. under the transition to retirement rules, while continuing to work.
If you are turning 75 during a financial year, you can make a non-concessional contribution on or before the day that is 28 days after the end of the month in which you turn 75. In addition, your lifetime super contributions or Total Super Balance (TSB) must not exceed $1.7 million (in 2022–23).
Taking money out of superannuation doesn't affect payments from us. But what you do with the money may. For instance we'll count it in your income and assets tests if you either: use it to buy an income stream.
Many people start using their super savings as soon as they retire and can access their super, but you don't have to. If you have other income sources or savings to live on, you could leave your savings in your super account. This means your money stays invested and could continue to benefit from investment returns.
You may be able to take your superannuation as a lump sum payment when you retire. This is usually tax-free from age 60.
Lump Sum withdrawals when aged over 65
You can make Lump Sum withdrawals whenever you like from your SMSF once you turn 65. There is no maximum Lump Sum amount if you are aged over 65 and you are free to access all your Super Benefit as desired. No tax is payable on Lump Sum withdrawals made after 65.
It's perfectly okay to start making super contributions again if you retire but later change your mind and re-enter the workforce. That includes if you have made a written declaration to your super fund you intended to retire and have taken a lump sum super payout or are receiving ongoing payments from your super fund.
Adding to super before tax
You can contribute up to $27,500 each year. These are contributions you have not paid any personal income tax on. They are called 'concessional contributions' because the concessional rate of tax paid on super is 15%.
Personal contributions can be made regularly from your after-tax pay, or as a lump sum at any time through the year.
When your superannuation is in accumulation phase, you are not required to make any withdrawals from your account, even if you are retired. However, once you use some or all of your accumulation balance to start an account based pension, you must withdraw a minimum level of pension income each year.
Withdrawals are paid and taxed as a normal super lump sum. If you're: under 60, this is generally taxed between 17% and 22% over 60, you won't be taxed.
How much super you'll need in retirement depends on the lifestyle you want. According to the government's MoneySmart website, if you own your home, the rule of thumb is that you'll need two-thirds (67%) of your current income each year to maintain the same standard of living.
The good news is that, yes, you will usually be allowed to return to work after retiring and accessing your super benefits. Even if you've taken a lump sum super payout or are receiving ongoing payments from your super fund, you still have the right to rejoin the workforce.
Age 60 or over and ceasing employment
You can access your super if you're aged 60 and over and you stop working, even if you subsequently get another job with another employer. As mentioned earlier, super payments are generally tax free once you turn 60.
As a general rule, most people will need 70% of their take home pay to maintain their lifestyle in retirement. And since we're living longer, which is great, your super may need to last for 30 years or more after you retire.
If you're 60 and over, the income will generally be tax-free. If you're between your preservation age and 59, the components of your super will dictate how it will be taxed.
The Bottom Line. For some, a lump-sum pension payment makes sense. For others, having less to upfront capital is better. In either case, pension payments should be used responsibility with the mindset of having these resources support you throughout your retirement.