Reducing minimum pension drawdowns
The minimum drawdown requirement for Account Based Pensions and similar products will be reduced by 50 per cent. The reduction will apply for the 2019/2020 and 2020/2021 financial years.
|Age||Current minimum||Reduced minimum|
|65 – 74||5%||2.5%|
|75 – 79||6%||3%|
|80 – 84||7%||3.5%|
|85 – 89||9%||4.5%|
|90 – 94||11%||5.5%|
If a member has already drawn the minimum pension amount for this current financial year, they will not need to take any further pension payments. This can be organized through your superannuation provider or Financial Adviser.
Early Release of Super
From mid-April, individuals will be able to apply through the ATO on the myGov portal. Once processed, the ATO will issue a determination to their superannuation fund to be processed. However, individuals may need to contact their super fund to update relevant banking details. The eligibility criteria are:
- Currently unemployed, or
- Eligible to receive a Jobseeker Payment, Youth Allowance, Parenting Payment (including single and partnered payment) Special Benefit or Farm Household Allowance, or
or after 1 January 2020:
- They were made redundant, or
- Their working hours were reduced by 20 per cent or more, or
- If they are a sole trader, their business was suspended or there was a reduction in their turnover of 20 per cent or more.
$750 one off support payments
There will be 2 separate payments of $750 made to several social security, veteran, other income support recipients and some concession card holders. The first payment will be made from 31 March 2020 and the second payment from 13 July in line with regular payment cycle. Those who are eligible will receive the payment automatically and will not need to apply for it.
To be eligible for the first payment, you must be residing within Australia and be receiving one of the following payment or holding the following concession card between 12 March 2020 and 13 April 2020.
eligible for the second payment, you must be residing within
Australia and be receiving one of the following payment or holding the
following concession card on 10 July 2020 but not eligible for the Coronavirus
Income Supplement detailed below.
- Family Tax Benefit
- Age Pension
- Farm Household allowance
- Carer Payment or Carer Allowance
- Disability Support Pension
- Parenting Payment
- Wife Pension
- Window B Pension
- Bereavement Allowance
- Newstart Allowance
- Jobseeker Allowance
- Partner Allowance
- Sickness Allowance
- Special Benefit
- Widow Allowance
- Pensioner Concession Card holder
- Commonwealth Senior Health Care Card older
- DVA concession card holders
- Veteran Gold Card holder
Reduction in deeming rates
From 1 May 2020, the deeming rates that affect the income test for several social support income recipients will be reduced. Below are the new rates:
|Current Rate||Rate from 1 May 2020|
This will take effect automatically affecting payment calculations from 1 May 2020.
$550 Coronavirus income supplement
From 27 April 2020, there will be a new income supplement added to fortnightly payments for all existing and new income recipients on the following payments:
- Youth Allowance Jobseeker
- Parenting Payment (Partnered and Single)
- Farm Household Allowance
- Special Benefit recipients
- Jobseeker Payment including those transitioning into the new payment (Widow Allowance, Sickness Allowance, Wife Pension and Partner Allowance).
This will not be a means tested income supplement and if eligible individuals will receive the full rate of supplement. The supplement will be provided for 6 months starting on 27 April 2020.
Those eligible for the $550 income supplement will not be eligible for the second $750 stimulus payments noted above.
Expanded access to income support
From 27 April 2020, there will be several measures in place for the same 6 month period mentioned above. These measures are:
- Jobseeker Payment and Youth Allowance Jobseeker will be accessible to permanent employees stood down or lost employment and sole traders, the self-employed, casual workers, contract workers and those required to care for some affected by Coronavirus. The current Income Tests will still apply to eligibility.
- Asset means testing for the Jobseeker Payment, Youth Allowance and Parenting Payments will be suspended for supplement period.
- The one week waiting period will also be suspended for those applying for the Parenting Payment, Youth Allowance and Jobseeker Payments between 12 March 2020 and 11 June 2020.
- Jobseekers with caring responsibilities or need to self-isolate, will be able to seek exemption from their mutual obligation requirements without medical evidence.
- Activities for Jobseekers can be rescheduled if the individual is unable to attend due to the Coronavirus. Job search requirements will reset to the default of 4 searches a month.
- Mutual obligation can be tailored to suit the needs or the individual and the community
- Sole Traders eligible for the Jobseeker payment will fulfil their mutual obligations by continuing to develop and sustain their business.
Luka Group will continue to update you. Please ring our office on 02 6883 2200 if you have any questions.