27 September 2023

New rules for superannuation due in July

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GESB Superannuation and West State Super funds have reminded members of a number of changes to superannuation that are due to come into effect in July.

In a statement, the funds said the changes applied to members of most of their schemes.

They said one of the most significant changes will be an extension to reduced minimum pension drawdown rates, which could affect Retirement Income Pension and Retirement Income Term Allocated Pension account holders.

“The Federal Government has extended the temporary reduction in minimum drawdown rates to 30 June 2023,” the funds said.

“The minimum drawdown rate was previously scheduled to return to the default from 1 July.

“This means if you have an existing Retirement Income Pension account and are currently receiving the reduced minimum drawdown, no changes will be made to your pension drawdown rate for the 2022-23 financial year, unless you request otherwise.”

The funds also said the Government will introduce a higher withdrawal limit for the First Home Super Saver Scheme, which could affect GESB Superannuation members.

“You may now be eligible to withdraw up to $50,000 of voluntary contributions made to your super to use towards the purchase of your first home,” they said.

“Previously, the maximum withdrawal for an individual under this scheme was $30,000.”

They said there was also now a lower age threshold for the super Downsizer Scheme affecting GESB Superannuation and West State Super members.

“If you’re 60 or older, you may be eligible to contribute up to $300,000 from the sale of your family home (owned for more than 10 years) into your super account,” they said.

“Previously, you had to be 65 or older.”

The funds said finally that the Government had removed the super contribution ‘work test’ for retirees aged between 67 and 74.

“If you’re a retiree aged 67 to 74, you can make voluntary contributions without needing to have satisfied the ‘work test’,” they said.

“Previously, if you were in this age group, you needed to have worked for at least 40 hours within 30 consecutive days in the current financial year to be eligible, unless you were exempt based on specific criteria,” the funds said.

Details of the changes can be accessed at the superannuation funds website at this PS News link.

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