Superannuation represents a significant asset for many Australians and offers considerable tax advantages; however, strict regulations govern when these funds can be accessed. While the primary circumstances for access include retirement, death, or disability, there are limited cases in which earlier access may be granted.
Early access is generally permitted in two key situations:
- Financial Hardship: This applies when individuals receive specific Centrelink or DVA payments over a minimum period and are unable to meet immediate living expenses.
- Compassionate Grounds: This allows for funding in specific situations, such as preventing a mortgage foreclosure, covering medical expenses related to life-threatening conditions or alleviating severe chronic pain.
Accessing superannuation on compassionate grounds requires an application to the ATO, which relevant medical certificates or mortgage details must accompany. If approved, the ATO will instruct the individual’s superannuation fund to release the necessary amount to address the expense. Below, we have included useful ATO links that provide more detailed information on compassionate grounds and financial hardship.
When seeking early access to superannuation on compassionate grounds, individuals are typically responsible for gathering the necessary supporting documentation and submitting the application through their MyGov account. It has come to the ATO’s attention that some medical and dental providers may be exploiting this pathway to assist super fund members in accessing funds for cosmetic procedures. You may have encountered advertisements promoting cosmetic services that highlight impressive results, but often overlooked are the implications for your superannuation balance.
The ATO has articulated its concerns regarding these practices in the article “Separating Fact from Fiction on Accessing Your Super Early.”
Superannuation fund members and SMSF trustees need to understand that accessing funds outside legislated conditions can result in significant penalties. We advise against sharing your MyGov login information or permitting third parties to submit applications on your behalf, as penalties may also be imposed for false declarations.
Should you have any inquiries or concerns about accessing your superannuation, please do not hesitate to contact us.