Retirees with account-based pensions are required to take the standard minimum pension amount each year from their account. This is called the minimum pension payment and for existing income streams, it is a percentage of your account balance on 1 July.
The Government halved this minimum payment requirement for 2019/2020 in response to the COVID-19 pandemic. It was introduced to allow pension members to withdraw less of their retirement savings, to assist pension account balances to recover from capital losses during volatile markets. This was a temporary reduction that applied over the last few years and extended to 30 June 2023.
However, for 2023/24, the minimum drawdown amounts returned to normal levels as shown in the following table.
|Age of beneficiary
|95 or more
Income stream providers may contact you if you hold existing account-based pensions to confirm the level of pension payments for the new financial year.
SMSF trustees should also closely review the requirements to ensure that the minimum pension amount will be paid in the financial year.
It’s important to seek advice for assistance in managing your cashflow.
This publication is prepared by Actuate Alliance Services Pty Ltd (ABN 40 083 233 925, AFSL 240959) (‘Actuate’), a member of the Insignia. Financial group of companies (‘Insignia Financial Group’). The information in this publication is general only and has not been tailored to individual circumstances. Before acting on this publication, you should assess your own circumstances or seek personal advice from a licensed financial adviser. This publication is current as at the date of issue but may be subject to change or be superseded by future publications. In some cases, the information has been provided to us by third parties. While it is believed that the information is accurate and reliable, the accuracy of that information is not guaranteed in any way. Past performance is not a reliable indicator of future performance, and it should not be relied on for any investment decision. Whilst care has been taken in preparing the content, no liability is accepted by any member of the Insignia Financial group, nor their agents or employees for any errors or omissions in this publication, and/or losses or liabilities arising from any reliance on this document. This publication is not available for distribution outside Australia and may not be passed on to any third person without the prior written consent of Actuate.