Accessing super early on compassionate grounds

Any applications for compassionate release of super that haven’t been finalised prior to 23 December 2022 will not be assessed until the ATO offices reopen.

The ATO said there are very limited circumstances when people can access their superannuation early. They may be allowed to withdraw some of their super on compassionate grounds for unpaid expenses. This is where they have no other means of paying for these expenses.

The amount of super people can withdraw is limited to what they reasonably need to meet the unpaid expense.

Compassionate grounds include needing money to pay for:

• Medical treatment and medical transport for you or your dependant
• Making a payment on a home loan or council rates so you don’t lose your home
• Modifying your home or vehicle to accommodate your or your dependant’s severe disability
• Palliative care for you or your dependant
• Expenses associated with the death, funeral, or burial of your dependant

The super people withdraw is paid and taxed as a normal super lump sum. The tax rate depends on various factors, including the person’s age and the components of the super lump sum.

The super fund will automatically deduct the tax from the super account. Refer to our how tax applies to your super and super lump sum tax table for more information.

If a person is a member of an exempt public sector super scheme (EPSSS), do not apply to us. People need to apply directly to their super scheme for early release of super.

EPSSS has its own state and territory laws for early release of super. The ATO advises that people talk to their super fund to find out if they are a member of an EPSSS.

Be aware that some advisers claim to offer early access to super by transferring your super into a self-managed super fund (SMSF). These schemes are illegal and there are heavy penalties if you participate. For more information, refer to illegal early release of super.