By Vicky Richards
Who can apply and what are the requirements?
Who can apply
Individuals who are financially affected by COVID-19 can access up to $10,000 of their superannuation if they meet the eligibility criteria. Eligible individuals can apply online via myGov to access the superannuation and the application must be submitted before 31 December 2020.
The early release measure has received much criticism with the level of withdrawals surpassing original forecasts. There are concerns about the long-term impact on retirement incomes. This measure should only be accessed by those who have an immediate need for financial assistance that outweighs the importance of saving for retirement.
The early superannuation payment is not subject to income tax and the money withdrawn will not affect Centrelink and Veterans’ Affairs payments, or the JobKeeper Payment.
To apply for early release, you must satisfy any one or more of the following requirements:
Integrity and Compliance
The ATO have issued a warning that they will take compliance action where individuals deliberately exploit the system. The ATO may stop applications and prevent super money from being released or alternatively they may review circumstances after an application has been processed to ensure the integrity of the program.
The ATO has available data sources that allows them to check for claims made incorrectly. This includes Single Touch Payroll (STP) data, income tax returns, information reported to the ATO by super funds and third-party data from agencies including Services Australia and Home Affairs.
Behaviours that will attract the ATO attention include:
Individuals who are unable to demonstrate their eligibility when the ATO asks for evidence may have the amount withdrawn included in their
assessable income and pay tax on this income at marginal rates. In addition, if the application provides false or misleading information,
the individual could face penalties of more than $12,000 for each false and misleading statement.