Withdrawal tax

Tax law requires us to deduct tax before paying your super to you. Your super is divided into a tax free component, which mainly consists of any after-tax contributions you’ve made, and a taxable component, which is the rest of your account. Your super fund calculates these components when you make the withdrawal. You can't choose to simply withdraw the tax-free component on its own.

The table below shows what tax applies depending on your age and tax components. Different tax rates may apply if you're accessing your super due to a terminal illness.

What tax you pay on withdrawing your super

Your age Taxable component Tax-free component
Age 60+ 0%. You don’t need to include this in your tax return. 0%
Preservation age to age 59 0% up to $200,000 for 2017-18. Withdrawals above this threshold are taxed at your marginal tax rate or 17%, whichever is lower, which includes the Medicare Levy. This money is treated as assessable income and therefore could affect your HELP debt payments and Medicare Levy surcharge.
0%, including any benefit withdrawn due to terminal illness.
Under preservation age Taxed at your marginal tax rate or 22%, whichever is lower, which includes the Medicare Levy. This money is treated as assessable income and therefore could affect your HELP debt payments and Medicare Levy surcharge.
0%, including any benefit withdrawn due to terminal illness.
If you die* 0% if paid to a dependent or if paid to a non-dependent, taxed at your marginal tax rate or 17%, whichever is lower, which includes the Medicare Levy.
0%

 

Note: If we don’t have your Tax File Number your withdrawal may be taxed at the top marginal rate of 47%, including Medicare Levy. 

*Adult children who aren’t financially dependent or in an interdependency relationship with their mum or dad are considered dependants under super law but non-dependants under the Tax Act. Therefore, if they receive a death benefit they would need to pay tax.