Taxation and your Super

In order to understand how your super withdrawals will be taxed, you need to know a few things:

  • Your preservation age when you receive the payment
  • Whether the payment is income or lump sum
  • The type of super income stream to be received
  • Whether the amount in your super account is tax-free or taxable
  • Whether you are receiving a death benefit stream.

To find the tax rates for your super payment, choose the link below that applies at the time you expect to withdraw super:

Why some Super is Tax-Free and some is Taxable

The money withdrawn is either tax-free or taxable. This is dependable on the type of contributions made and whether tax was paid on it.

  • Non-Concessional (after-tax) contributions: those made from income after you paid tax on it. These are tax-free when withdrawn from your super. These include personal contributions made from your after-tax income (unless you were allowed a tax deduction).
  • Concessional (before-tax) contributions: those made from income before you paid tax on it. These are taxable when withdrawn from your account. These include super contributions from your employer; money you salary sacrifice; and contributions you were allowed to claim a tax deduction for.

 

If your age is less than your preservation age:

Tax on Withdrawals of Tax-Free Component

No tax is paid on the tax-free component of your super where it is:

  • Withdrawn as a lump sum
  • Received as an account-based income

 

Tax on Withdrawals of Taxable Component

See below for when tax is paid on different types of super and withdrawals:

If you are between your preservation age and 60 years old

Tax on Withdrawals of Tax-Free Component

No tax is paid on the tax-free component of your super where it is:

  • Withdrawn as a lump sum
  • Received as an account-based income
  • Received as a capped defined benefit income stream and you were between your preservation age and less than 60 years old, which is not a death benefit income stream where the deceased was 60 years or older at the time of death.

 

Tax on Withdrawals of Taxable Component

See below for when tax is paid on different types of super and withdrawals:

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