Income stream payments
Find out more about First State Super’s income stream payment options:
Regular income options – minimums & maximums
You can choose the amount of your income stream payments that you receive. However, the Federal Government sets limits on the minimum and maximum amount of income stream payments you can receive each financial year.
Minimum payment limits
The minimum payment limit is calculated as a percentage factor (see the table below) of your account balance rounded to the nearest $10. The minimum payment limit, age and account balance are calculated at the time the income stream commences and also on 1 July in each subsequent year.
|
Age at commencement date then each 1 July
|
Percentage factor
|
|
Under 65
|
4%
|
|
65 – 74
|
5%
|
|
75 – 79
|
6%
|
|
80 – 84
|
7%
|
|
85 – 89
|
9%
|
|
90 – 94
|
11%
|
|
95 or more
|
14%
|
If you commence your income stream part way through a financial year, the minimum payment limit for the first year will be reduced on a pro-rated basis based on the number of days between commencement of your income stream and the end of the financial year.
Example
John is 57 years old and has opened a transition to retirement income stream with an account balance of $200,000. John has opted for his income stream payments to start on 1 December 2007 and to be paid the minimum amount. Based on John’s age his percentage factor is 4%.
The minimum payment limit is calculated as follows:
1. Annual minimum: $200,000 x 4% is $8,000
2. Daily minimum: $8,000 ÷ 365 days in a full year is $21.92
3. John’s minimum: $21.92 x 212 days remaining in the year to the nearest $10 is $4,650
If you commence a retirement income stream or transition to retirement income stream between 1 June and 30 June, you may choose not to take a payment in that financial year.
Maximum payment limits
Retirement income streams:
- There is no maximum payment limit on the amount that can be withdrawn each year.
Transition to retirement income streams:
- Payments in a year are limited to a maximum of 10% of the account balance at the start of the year (or in the first year, the account balance at the start date for the income stream).
- The maximum limit ceases to apply if you satisfy a condition of release and commute your transition to retirement income stream to a retirement income stream.
- The 10% maximum for transition to retirement income stream payments is not prorated for payments in the first year if started part way through the financial year.
Example
A person commences a transition to retirement income stream on 1 November with $100,000 and requested the 10% maximum as a monthly payment. The calculation used in this situation is $100,000 x 10% = $10,000 divided by 8 monthly payments of $1,250.
 Back to top
How much income?
How much income you decide to take in a year depends on the amount you are allowed to take by law as well as your lifestyle and other financial commitments.
Our budget calculator shows you how much income you spend to cover your living expenses. Click here to find out more You may change the amount of your income stream payment during the year provided that you stay within the allowable minimum and maximum amounts. Contact us and we will send you the forms.
Back to top
Payment frequency
You can choose to have your nominated pension income paid:
- Fortnightly, monthly, quarterly, half-yearly and yearly
Back to top
One-off payment options
First State Super Transition to Retirement Income Stream
Lump sum withdrawals are only available in the following circumstances:
- To cash any unrestricted non-preserved component of your income stream account.
- To pay a superannuation contributions surcharge debt.
- To give effect to a family law payment split order.
- To transfer funds back into your non-pension superannuation account in First State Super or roll over to another retirement income stream product which has the same lump sum withdrawal restrictions.
First State Super Retirement Income Streams
Withdrawals can be made from a retirement income stream account over and above regular pension payments if:
- you die;
- it is to pay the surcharge, a Family Law benefit split or a refund in a cooling off period;
- there is enough left in your retirement income stream account to pay the minimum pension amount for the year;
- the proportional minimum pension amount for the for the year has already been taken.
Withdrawal requests may be treated as either:
- An irregular pension payment. In this case, you may pay income tax on the payment, but may be eligible for a 15% tax offset.
- A lump sum withdrawal. This is treated as a superannuation benefit payment and may be subject to lump sum tax.
- A combination of an irregular pension payment and a lump sum withdrawal.
Each withdrawal will attract a fee of $30. For more detailed information about income stream payments please read the Product Disclosure Statement (PDF 3775kb)
Back to top
How long will my income stream account last?
It is important to remember that your income stream may not provide you with an income stream for the rest of your life.
How long your income stream will last in retirement depends on things like your initial investment, investment returns (which may be positive or negative), fees and other costs, pension payments, and any withdrawals you make.
Your First State Super income stream will continue to be paid until the earlier of:
Back to top
|
Need to change your details? Click here to find out how
|
