Changes to super ahead as COVID-19 losses deepen

23 March 2020

The Government has announced that workers who lose their jobs will be able to drawdown $10,000 from their superannuation to cover losses caused by COVID-19. 

Withdrawals, which would be available from April, would be capped at $10,000 this financial year and a further $10,000 in the next financial year, which would be tax-free. 

It would be available for those who were eligible for the coronavirus supplement as well as sole traders whose hours or income had fallen by more than 20% as a result of COVID-19. 

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The retirement industry was now asking changes were made to the treatment of super for retirees, whose portfolios are rapidly losing money. 

The Association of Independent Retirees said retirees needed more flexibility in the minimum amount they were able to draw from their super. 

Legislation currently required retirees to draw a minimum percentage from their superannuation but being forced to withdraw when the market was falling sharply could leave their account balances ‘substantially diminished’, it said. 

President Wayne Strandquist said: “The Association seeks Government intervention to give immediate relief to the current age-based drawdown percentages for account-based pension income streams and allow greater flexibility for retirees to vary the amount they can draw from their superannuation account. 
“The Association has previously called on the Government for greater flexibility by broadening of the age ranges and a lowering of the minimum drawdown percentages but with the current investment market crisis, the Association seeks immediate options for retirees to lower or cease withdrawals from their superannuation account and resume their usual drawdowns when the investment markets improve.” 

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