The ATO reminds taxpayers that an SMSF must pay a minimum amount each year to a member who is receiving a pension that commenced on or after 20 September 2007 (e.g., account based pensions). If the minimum payment is not made by 30 June, this can result in adverse taxation consequences for the member.
In response to COVID-19, the government temporarily reduced superannuation minimum drawdown requirements for account-based pensions and similar products by 50% for the 2020, 2021, 2022 and 2023 financial years. i.e. minimum pension payments required to be paid from super funds were halved.
However, for the 2024 financial year, the 50% reduction in the minimum pension drawdown rate will no longer apply. This means that, from 1 July 2023, when taxpayers calculate the minimum annual payment for their pension, the 50% reduction will not apply to the calculated minimum annual payment.
If you are on an account based pension in your self-managed super fund and would like to confirm your minimum pension withdrawal for the 2024 financial year please contact our office.
