SMSF Lump Sum Withdrawals
If you meet the conditions, then you certainly can. However, if you are thinking of withdrawing money from your self-managed super fund, it is vital to know some key points. One of them is Lump Sum Withdrawals. It refers to the amount found from your SMSF that does not fall under Pension Payment.
You are eligible to make Lump-Sum withdrawals provided you are any of the following:
- 65 years old, or
- If you’re somewhere in the middle of the preservation age and 65, you’d have to be Retired.
It doesn’t matter if you have started with your pension or not. Consequently, you are considered ineligible for Lump Sum SMSF withdrawals if your age qualifies but you are not Retired.
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Know Your Preservation Age
As stated in the earlier paragraph, you’d have to be at the preservation age so that you’re eligible for Lump Sum Withdrawals. Here’s a helpful table to determine yours:
|Birth Date||Preservation Age|
|Prior to July 1, 1960||55|
|July 1, 1960 – June 30, 1961||56|
|July 1, 1961 – June 30, 1962||57|
|July 1, 1962 – June 30, 1963||58|
|July 1, 1963 – June 30, 1964||59|
|From July 1, 1964||60|
After using the table, are you not quite at the preservation age? If yes, then you’re barred from availing your Super Benefit. This rule applies with only two exceptions: (1) you qualify for unrestricted benefit; or (2) you have early access eligibility.
What happens with Lump Sum Withdrawals when you’ve already started your Pension?
If you have already begun with your pension, you stand to access benefits differently. Aside from your eligibility for Lump Sum withdrawals, you can also obtain pension income from the SMSF.
Are you any of the following:
- 65 years old, or
- Retired and in the middle of the preservation age and 64?
If so, then there are no limits to how much Lump Sum Withdrawals you can make. If you wish to withdraw all of your Super Benefit, you’re allowed by law. However, be mindful that Pension withdrawals are governed by rules different from Lump Sum withdrawals.