Accessing superannuation requires you to meet a superannuation condition of release.
Generally, this first opportunity that you have to meet a condition of release is by reaching your superannuation preservation age.
The superannuation preservation age for people born between 1 July 1961 and 30 June 1962 is 57.
This signifies the first time that individuals with birth dates within this period are able to access their superannuation savings.
However, there are certain superannuation withdrawal rules in relation to accessibility and taxation that needs to be considered, despite having reached age 57.
This article explains the rules around accessing superannuation at your preservation age.
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Click here for superannuation rules for people aged over 65.
Superannuation Preservation Age
The table below details your superannuation preservation age based on when you were born.
| Date of Birth | Preservation Age |
|---|---|
| Before 1 July 1960 | 55 |
| 1 July 1960 – 30 June 1961 | 56 |
| 1 July 1961 – 30 June 1962 | 57 |
| 1 July 1962 – 30 June 1963 | 58 |
| 1 July 1963 – 30 June 1964 | 59 |
| After 30 June 1964 | 60 |
Accessing Super At 57
As mentioned, you are able to access your superannuation at age 57 if you were born between 1 July 1961 and 30 June 1962. You are able to access your superannuation in the form of a lump sum or as a superannuation pension income stream. However, your work and employment status may limit your ability to access your superannuation.
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Can I Access My Super At 57 And Still Work?
Provided you have met your superannuation preservation age, you are able to access your superannuation and continue to work. There are two ways that this can occur.
The first and most common way of accessing your superannuation after reaching your preservation age and still working is via a Transition to Retirement (TTR) Pension. A Transition to Retirement Pension is a Non-Commutable Income Stream that can be commenced with some or all of your superannuation accumulation savings (subject to the Transfer Balance Cap from 1 July 2017).
A Transition to Retirement Pension requires you to draw an income of between 4% and 10% of your pension account balance as at 1 July of each year (pro-rata if the pension was commenced part way through a financial year).
Lump sum commutation withdrawals are unable to be made from a Transition to Retirement Pension.
There is no limit on how much you earn or how many hours you work if you have a Transition to Retirement Pension.
Read this article about accessing your super at 60 and still working.
Can I Cash In My Super and Still Work?
A Transition to Retirement Pension provides you with limited access to your superannuation savings while you are still working and does not allow you to ‘cash in’ all of your superannuation savings.
However, the second, and less utilised way of accessing your superannuation after reaching your superannuation preservation age will give you access to all of your superannuation savings, which can be accessed as a lump sum or pension income stream (standard account based pension – with no upper income threshold), or a combination of both, without breaching any superannuation withdrawal rules.
It requires you to meet the superannuation definition of ‘retirement’. There are several definitions of ‘retirement’ for superannuation accessibility purposes, but one such definition is, as follows:
In the case of a person who has reached a preservation age that is under age 60, the retirement of that person is taken to occur if an arrangement under which the member was gainfully employed has come to an end; and the trustee of their superannuation fund is reasonably satisfied that the person intends never to again become gainfully employed, either on a full-time or a part-time basis.
Click here to access my Superannuation Preservation Age Calculator to calculate your specific preservation age.
What this means is that, if you are working and then decide to retire permanently with no intention of returning to full-time or part-time work, you will have full and unlimited access to the superannuation savings that you have accumulated up until that point.
The important word within the definition is ‘intention’.
At that time when you ceased work permanently, your intention to retire may have been genuine, but that does not mean that you can’t return to part-time or full-time work at some point in the future.
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It is very important, however, that this condition of release is not abused.
All of your personal and employment circumstances at the time of your intended permanent retirement must be consistent with your intentions to permanently retire (e.g. ceasing an employment arrangement on Friday with the intention of never returning to work, but then starting a new job two weeks later would not be looked upon favourably by the Commissioner of Taxation and would likely be in breach of the superannuation conditions of release provisions).
Also, if you do return to work, any ‘new’ contributions made to superannuation in respect of your return to the workforce will be inaccessible. Only your superannuation balance at the time you initially retired will be accessible. You will need to meet another superannuation condition of release to access to additional contributions.
So, technically, you are not able to cash in your super and still work; however it appears you can cease work with the intention of never returning, cash in your super, and then return to work.
Whatever the case, you should always obtain personal financial advice from a licensed financial planner and/or speak with your superannuation provider regarding your circumstances, prior to accessing your superannuation.
Accessing Super at 57: Tax on Income Streams
Whether you commence a TTR Pension while still working after reaching your Preservation Age, or commence an ordinary account based pension by permanently retiring after your Preservation Age, the taxation of your income stream will be the same.
Your income stream is made up of two main static components:- the ‘Tax-Free’ Component and the ‘Taxable’ Component. The Taxable Component is then further broken down into the Taxable (taxed) Component and Taxable (untaxed) Component.
The taxable/tax-free proportion of an income stream is unique to each individual income stream, based on the components at the time the income stream was commenced. You should contact your superannuation provider to ask for the taxable/tax free make-up of your superannuation balance.
Here’s how each component is taxed when received as an income stream:
| Component | Tax |
|---|---|
| Tax-Free | 0% – not assessed for tax |
| Taxable (taxed) | Taxed at MTR minus 15% offset |
| Taxable (untaxed) | Taxed at MTR |
All income payments must be made proportionately from each component. Click here to read more about the taxation of the taxable component.
For example, if your superannuation pension was made up of 30% tax free component and 70% taxable (taxed) component and your monthly payment was $5,000, then $1,500 (30% x $5,000) would be received completely tax free and the remaining $3,500 would be taxed at your marginal tax rate. However, a 15% offset of $525 on the ‘taxable’ component (15% x $3,500) of the payment would be received to reduce your tax.
Accessing Super at 57: Tax on Lump Sums
If you decide to make a lump sum withdrawal from your superannuation accumulation account (i.e. not a superannuation income stream), the taxation of the withdrawal will again depend on the tax components of your specific balance. All lump sum withdrawals must be made proportionately from each component.
Here’s how each component is taxed when received as a lump sum:
| Component | Tax |
|---|---|
| Tax-Free | 0% – not assessed for tax |
| Taxable (taxed) | first $210 000* = 0% |
| Taxable (taxed) | balance over $210 000 = 15% |
| Taxable (untaxed) | first $210 000* = 15% |
| Taxable (untaxed) | amount from $210 000 to $1.515M* = 30% |
| Taxable (untaxed) | amount over $1.515M* = 45% |
*This amount is a lifetime cap and is indexed
Note: Medicare Levy applies to all tax rates above 0%
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If I retire at 57 could I return to the workplace within 5 months
In order to access your superannuation savings in full you need to have reached your superannuation preservation age and retire with no intention of returning to work. Should your circumstances change, you are able to return to work at a later date.
Alternatively, you can commence a transition to retirement income stream after reaching your preservation age even if you are still working.
Hi
I am at preservation age but under 60 and wish to get my superannuation as a lump sum as I am retiring due to ill health. My income for this tax year has been minimal, and my superannuation is under $100000, will this be taxed at 15% if I withdraw?
A person is able to access their super if they have met their superannuation preservation age and has no intention of returning to full time or part time work.
A superannuation balance consists of tax-free components and taxable components.
You should contact your super fund and ask them how much of your balance is the tax-free component and how much is the taxable.
All withdrawals must be made proportionate from each tax component (element). That is, you cannot choose which components form part of your withdrawal.
The tax-free component of a super withdrawal is received tax free – regardless of age.
The taxable component is generally assessed for tax under age 60; however, can be received tax-free up to the lifetime low rate cap amount.
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Hi Chris
I am a full time foster Carer of three children. The youngest being 11. I turn 58 in March. I was wondering if I am able to access some of my superannuation?
Hi Roz, you are only able to access your super in full if you have reached your preservation age and are retired with no intention of returning to full-time or part-time work. Alternatively, you can generally have partial access to your super via a TTR pension once you have reached your preservation age, regardless of your work status.
I hope this helps. Thank you for being a foster carer.
Regards,
Chris
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Hi Chris,
Thanks for your service … much appreciated. I turn 57 next April, have lost my job, and would like to access my full super to pay off half my mortgage (which I can no longer afford to pay on a much reduced income – Newstart). I have about $126 000 accumulated I believe. Do you envisage a problem with this? How much would I expect to get taxed?
Thanks for your help.
Miranda
Hi Miranda,
To access your super in full, you need to meet a full superannuation condition of release. ‘Retirement‘ is considered a full condition of release. A definition of retirement includes reaching your superannuation preservation age, retired and no intention of returning to work.
The tax on a lump sum super withdrawal depends on the components that make up your balance and the type of withdrawal (lump sum/income stream). You can contact your super provider and ask them what your ‘taxable’ and ‘tax free‘ components are. Tax Free components can be withdrawn tax free, regardless of age; however, there may be tax payable on taxable components. All withdrawals must be made proportionately from each component.Read here for more info on the tax on taxable components.
Also, prior to making any withdrawals, you should consider if this will affect social security payments, such as Newstart.
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Hi Chris
I am 57 and experiencing some financial stress. Is there an amount that I can withdraw to help me through this difficult time? I work full time but had been employed for a few years.
Thanks
David
Hi David, sorry to hear about your financial stress. You can generally access your super via a TTR pension if you have met your super preservation age and are still working. Alternativley you may be able to access some of your super under the financial hardship provisions.
If I get my super at 57 can I go back to work 2months later fulltime
Hi Mark, in order to access your super while under age 60 but over your preservation age, you need to satisfy the condition of retiring with no intention of returning to full-time or part-time work. It does not, however, prevent you from returning to work if your intentions change. This rule is not to be abused though.
Hi Chris, I will be turning 57 next month, can I access at least 10% of my super while working on part time basis thank you
Hi Adela, what a lovely name! Once you reach your superannuation preservation age, you can generally use some or all of your super to start a TTR Pension. A TTR Pension allows you to draw an income of between 4% and 10% of your account balance each financial year. The intention of a TTR Pension was to allow people to reduce working hours in their pre-retirement years. Be mindful though, some or all of your pension income may be assessable for income tax purposes while under age 60.
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Hi Chris i was born 18/11/1961, i am fit and healthy so i plan to keep working till i am at least 65, but i need about $60,000.00 to fix my teeth can i access that amount TAX FREE?
Hi Michael, in order to access a lump sum from super while over preservation age, but under age 60, you need to be fully retired with no intention of returning to work. If you are still working, you can only access your super via a TTR Pension, whcih gives you access to 10% of your account balance each financial year. Thereofre, a balance of $600k, could theoretically allow for $60,000 to be withdrawn. However, there are likely going to be costs for setting up a TTR and most probably tax on withdrawals while under age 60.
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Hi I’m retired at 57 just turned,my husband is still working surrporting me,how much could I get out of my Supa not planning on going back working
If you have reached your super preservation age and retired with no intention of returning to work, there is generally no limit to how much you can withdraw from super. However, there may be tax implications while under age 60.
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Hi ,I am 58yrs and work part time..I only have $65,000 in my super account.My husband passed away 7mths ago and im finding it a bit difficult money wise,I have a mortgage,would i be able to get a lump sum to pay towards this?
Hi Gayle, I’m very sorry to hear about the passing of your husband. At your age, you can only generally access a lump sum from your super if you are retired with no intention of returning to full-time or part-time work. Part time is defined as 10-30 hours per week. You can, however, commence a transition to retirement income stream after reaching your preservation age. A transition to retirement pension allows you to draw up to 10% of your balance each year, which may assist with meeting your commitments.
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Hello Chris, I have just reached my preservation age of 57, but I have been unemployed since I was made redundant at 49. The questions I have are as follows, 1/ Can I access an income stream from my super? 2/ Can I access all of my super? and which one would minimise my tax? I’m fairly confident that I won’t be finding employment again and I would love to pay off my mortgage. What questions should I be asking my super provider, as of course, I would like to minimise the tax I would need to pay. I’m just a few hundred shy of $900,000 in my super account. Thx
Hi Lex,
In order to have full access to your super, you need to have no intention of returning to full-tims or part-time work (retirement super condition of release). This will give you unrestricted access to your super. However, as you say, you need to be mindful of tax implications in accessing your super. Your super can comprise of three tax components: tax-free, taxable (taxed) and taxable (untaxed). Each of these are taxed differently depending on the form in which you access your super (i.e. lump sum or income stream). In saying this, the tax-free component will always be received tax-free, regardless of age. You can see how the taxable portions will be taxed in this article. All super withdrawals, whether taken as an income stream or lump sum, must be proportionate from each component.
If you do have an intention of returning to work, you cannot meet this ‘retirement’ condition of release. However, you should still be able to have limited access to your super via a transition to retirement income stream.
Your first step should be asking your super fund what the tax components are that make up your super balance.
Based on your stage in life, intentions, and reasonable superannuation balance. I would suggest seeking professional financial advice, as it can be difficult to navigate super rules, not to mention being in a position to maximise the effectiveness of your retirement plans. If you do not have an adviser, please feel free to view our website to see if we can assist https://www.torowealth.com.au/.
All the best,
Chris
Hi my husband has a terminal illness and he can no longer work and I also am not working to care for him, are we able to access his super which is under 100,000. Thanks Nicky
Hi Nicky, I am very sorry to hear about your husband’s health. It must be a very difficult time for you.
In order to access super in full, a person needs to meet a superannuation condition of release.
A condition of release includes a terminal medical condition. See here http://www6.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_reg/sir1994582/sch1.html
A terminal medical condition is defined as a condition wehre two registered medical practictioners have certified (jointly or spearately) that the person suffers from an illness that is likely to result in death within 12 months. At least one of the practioners needs to be a specialist relating to the illness. See here 6.01A for details https://www.legislation.gov.au/Details/F2012C00564
I would suggest calling your husband’s super provider and asking what the process is to withdraw his super.
Alternatively, if he is over his super preservation age, he should be able to access his super in full, without meeting the medical requirements listed above.
Be mindful of taxation on super withdrawals. He may be able to utilise the low rate lump sum withdrawal cap https://www.ato.gov.au/Individuals/myTax/2018/In-detail/Medicare-items/?page=17
hi Chris I`ve just turned 57 can i access part of my super approx $150.000 to pay out a reverse mortgage which is still an investment, or do i need to stop working
Hi Klaus,
Once you reach your superannuation preservation age, you can have limited access to your super via a transition to retirement income stream, even if you are still working. Tax will usually be payable on the income while under age 60.
If you would like to make a lump sum withdrawal, you generally need to meet a full condition of release which, based on your age, would require you to require with no intention of returning to full-time or part-time work.
Regards,
Chris
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I have reached my preservation age of 57. If I decide to Retire and take my super as a lump sum, then in the future decided that I wanted to return to Full-Time work, how soon after Retirement could I return to work?. Thank you
Hi Bron, in order to access your super when under age 60, you need to retire with no intention of ever returning to work.
Regards,
Chris
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Hi Superguy,
I am turning 57 on boxing day. I would like to access my super but not all of it, I would like to take a small amount say $10000 dollars. Is it true that I have to wait until I turn 58, in a year, until I can access it? Or is there another way? Thanks in advance.
Hi Troy, based on your date of birth, your preservation age is 58. This means that you are generally unable to access your super until attaining this age. Once you do reach this age, your employment status will determine how much you are able to access and in what form (income stream / lump sum). Being under age 60 may also mean that tax will be payable on any withdrawals.
Regards,
Chris
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Hi there I’m 60 & my husband is almost 63. He’s working full-time & I work 2 casual jobs. We’ve had a SMSF property for 6-years & the funds are totally in the property with no cash. The rent & our employer super payments cover the outgoings. When is the earliest and/or the recommended time to sell the property & can we use the money for whatever? It has a loan on it & our home we live in also has a loan. Thankyou!
Hi Christine,
Thank you for your question.
In general, an investment (including a property) within an SMSF can be sold at any time. The associated loan would most likley need to be paid out when the property settles.
If you sold the property, the net proceeds would remain within the SMSF and could be invested as you see fit, provided it is line with the SMSF Investment Strategy.
In regards to accessing your super in full, you need to meet a full superannuation condition of release by meeting the definition of retirement for superannuation purposes, or reaching age 65.
You can, however, have limited access to your super via a TTR Pension while you are still working, provided the Trust Deed of your SMSF allows for it.
Hope this helps.
Regards,
Chris
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Hi Chris,
I live in the UK and have a preserved pension in Australia when I lived there for 7 years.
I am 58 and I understand I may withdraw some funds, either as a lump sum or an income stream. I work 30 hours per week and do not currently intend to retire. What would be the best option for me tax wise?
Many thanks
Hi Fi, the tax components of your super, your residency status and any other taxable income will all impact the tax you pay on super withdrawals. If I were you, I would also double-check your ability to make lump sum withdrawals, as you may not have yet satisfied a full superannuation condition of release. Either way, given your circumstances, I would suggest speaking with your super fund about your withdrawal options and discuss tax implications with an accountant – maybe one based in Australia.
Regards,
Chris
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Hi Chris , thanks for your good work .
My circumstance is this , I’m born Jan 1961, I’ve always been interested in investing and have done so most of my life . My occupation goes on the tax return as ” Investor ” , so Im self employed investor I guess . I also run a SMSF , its balance is only about 300 k , but it has a couple of longer term investments in it also , I’m happy with its ASX holdings , dont particularly wish to change that position . Turning 60 in Jan I was thinking about maybe topping up my income via TTR , as the fund produces about $13,500 pa in dividends , distributions .
So although Im retired , as in I dont go to a job everyday , Im not retired exactly from a taxation point of view . So what are the options for someone like myself ? Looking at it from a holistic point of view of ” Total net worth ” and most tax efficient perspective .
Im looking to see what options I have available ? The other investment holdings are all just held in my name , not in a company structure .
With kind regards
David
Hi David,
One definition of retirement is: having reached your superannuation preservation age with no intention of returning to work. For superannuation purposes, I think you could have a strong argument for already being considered ‘retired’ – assuming you have no intention of returning to full-time or part-time work (other than investing). Otherwise, every retiree could be seen as an investor and therefore never retired. Does that make sense?
The options for someone like yourself, I imagine, would be plentiful. Someone of your age and in your position is about to open the gate to several strategies that can be very financially beneficial. You might consider seeking advice from a financial planner and request ‘strategy advice only’ (assuming you want to retain control of your investments). You are welcome to make a complimentary 15-minute with our practice, Toro Wealth, here https://calendly.com/torowealth/15mincall if you want to get an idea of how a financial planner can help you.
Either way, all the best.
Chris