New limits on pension transfers

06 December 2017

There is now a limit to the total amount of superannuation that you can transfer into a pension account, where your investment earnings (including capital gains) are tax-free.

For 2017/18, this transfer balance cap is $1.6 million, with each member of a couple having a separate cap.

If you have more than $1.6 million in super, you can keep the excess in an accumulation account, where your earnings will be taxed at up to 15%, and capital gains taxed at 10% (if held for 12 months or more).

In the future, this pension cap will be indexed to the consumer price index (CPI) in $100,000 increments.

Transition-to-retirement (TTR) pensions are not included in this transfer balance cap, but will count if you are considered to be in ‘retirement phase’ through satisfying the following conditions:

• retirement
• terminal medical condition
• permanent incapacity
• reaching age 65.

Tax on earnings from investments held in TTR pensions is increased from 0% to a maximum of 15%.

You can continue to make transfers to the retirement phase as long as you have available cap space.

Have a question?

Your financial adviser can provide you with more information and answer any questions that you may have.

Alternatively, you can call our experts for a free chat, Mon-Fri 8am-6pm (EST) on 13 11 55, or make an obligation free appointment with a Suncorp financial planner.