UPDATE (20 February 2009): Super decision for self funded retirees
A decision by the Federal Government to temporarily relax taxation rules regarding minimum withdrawals will bring relief to self funded retirees affected by the global financial situation.
The rules require self funded retirees to withdraw between four and 14 per cent (depending on age) from their superannuation account each year. The government decision will mean the withdrawal rate will be halved this financial year.
The temporary relaxation in the rule will mean those self funded retirees who have already withdrawn at least half of their minimum pension for the 2008/09 financial year will not require to withdraw any further amounts for the remainder of the financial year. It’s hoped this will help self funded retirees who have been forced to sell investments to meet their requirements.
What does the government decision mean for you?
Every individual is different and as with every financial decision it’s important to act. Contact Davenports Financial Solutions so we can review your situation and provide accurate advice and recommendations. Our goal is to help you maximise your superannuation so that you can enjoy the most financially comfortable retirement possible.
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Fresh from Canberra (18 February 2009):
Recognising the huge fall in superfunds’ value, especially those holding listed shares, the Federal Government yesterday announced a temporary relief for the superfund account-based pension minimum withdrawal requirements. Under the current account-based pension rules self-funded retirees have a choice to withdraw a minimum of 4% to 14% or the maximum value of thier superfund balance depending on their age.
The temporary relaxation of the withdrawal rules allow pensioners to take half of their minimum withdrawal requirements. This measure is to prevent force selling of assets in the superfund just to fund the minimum payout which by doing so could result in crystallising a permanent loss in value.
The 50% reduction applies for the current financial year.
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