If you’re retired and drawing a pension from your super, now is a good time to review your fund before the end of the financial year.
A quick check now can help make sure your pension payments are on track, your fund stays compliant, and you continue to receive the tax benefits available in retirement phase. Leaving it too late can create unnecessary stress and consequences.
Here are the key things to consider before 30 June
Make sure you meet your minimum pension payment
If you’re drawing a retirement-phase pension from your SMSF, you need to take at least the minimum annual pension amount by 30 June. If you don’t, the fund may lose its tax exemption on the earnings that support that pension.
The minimum amount is based on your age and your pension account balance at 1 July 2025.
| Age of beneficiary | Minimum percentage needed to be withdrawn |
| Under 65 | 4% |
| 65 – 74 | 5% |
| 75 – 79 | 6% |
| 80 – 84 | 7% |
| 85 – 89 | 9% |
| 90 – 94 | 11% |
| 95 and over | 14% |
If you usually take your pension as one payment close to year-end, make sure the money clears the super fund’s bank account before 30 June.
Consider how much you withdraw
You’re generally allowed to withdraw more than the minimum pension amount, but that may not always be the best option. Taking extra money out of your pension account can reduce the amount that remains in the tax-free retirement phase. Depending on your circumstances, it may be worth reviewing whether additional withdrawals are appropriate and how they should be treated.
Starting or stopping a pension before year-end
For some people, starting a pension before 30 June can be beneficial, as earnings on that balance may become tax-free in the currrent finanacial year.
It’s important to make sure everything is set up correctly. This includes:
- Making sure the pension payment is pro-rated if it starts part-way through the year
- Ensuring all paperwork is signed and completed properly
- Checking that you don’t exceed the Transfer Balance Cap, which is $2 million in 2025–26
Likewise, if you are planning to stop or reduce a pension, the timing and documentation also matter. These decisions can affect your super balance, reporting obligations and tax position.
Check your Transfer Balance Cap position
If you have a retirement-phase pension, it’s important to keep an eye on your Transfer Balance Cap. This cap limits how much super can be transferred into the tax-free retirement phase.
For 2025 – 26, the general cap is $2 million.
Events such as starting a pension, commuting part of a pension, or receiving a death benefit pension can all affect your position. These may also need to be reported to the ATO. Errors or delays in reporting can lead to compliance issues and potential tax consequences.
A little planning before 30 June can go a long way. Reviewing your pension now can help you stay compliant, protect valuable tax concessions, and make sure your retirement strategy continues to work as intended.
If you’d like help reviewing your minimum pension requirements, pension payments or SMSF compliance before year-end, please get in touch.