Early access to super: how it’s working12 May 2020 3 min read
The government’s temporary compassionate ground of early release of super allows those who are eligible to withdraw up to $10,000 from their super in the 2019/20 financial year and up to a further $10,000 in the 2020/21 financial year.
As at 3 May, Australian Prudential Regulation Authority (APRA) data showed that super funds had already issued early release payments totalling $6.3 billion to 830,000 members and that 96% of payments are being processed within five business days.
How long does the early release of super take?
Step One - submit your application to the Australian Taxation Office through ATO online services at myGov.
Step Two - the ATO will process your application which can take up to four days. If approved, the ATO will forward your application to your super fund for payment.
Step Three - your super fund will review your application. APRA has asked super funds to make payments to members within five business days but it may take longer, for example, if fraud is suspected or the fund needs to confirm your details.
Step Four - if you are a member of an APRA-regulated super fund, your fund will transfer the benefit to your nominated bank account. If you are with a state-administered fund of SMSF, the payment time may vary.
Payments may take longer than five business days if:
- incomplete information is provided by the ATO;
- application errors by members need clarification;
- there are mismatches between member information provided by the ATO and that held by the fund; and
- you are a defined benefits member whose application needs additional processing.
Early access to super FAQ
How do I access money from my super under the financial hardship clause relating to coronavirus?
You need to log in to myGov and complete the request form. You will need to meet the eligibility requirements, which you can find here. If you are eligible, the Australian Taxation Office (ATO) will advise NGS Super and we will release the money to your nominated bank account. You can make sure that your contact details and bank account details are correct by logging into Member Online.
Do I need to contact NGS Super to request early release?
No, you simply need to apply via myGov and we will be notified by the ATO if your application is approved. Then we will make the payment to your nominated bank account.
Will I receive my funds five days after I apply?
No, it will be slightly longer. It will take the ATO up to four business days to process your application. Once we receive the instruction to pay funds to your account, that process will take up to five business days if we do not need to contact you for further details.
Is this different to existing early release provisions?
Yes, the new early access to super payment announced as part of the Government’s response to COVID-19 is in addition to existing early release options such as severe financial hardship, etc. It’s also temporary, applying only to the 2019/20 and 2020/21 financial years.
What impact will early release have on my final super balance?
This will depend on your personal circumstances, especially your current super balance and your age. A financial adviser can help you work out the best approach. You can also see some modelling done by Industry Super Australia here.
You should also be aware that if you make a withdrawal and your super account balance falls below $6,000, you may lose the insurance you hold within your super.