Do I have to pay tax on lump sum withdrawals?
Super withdrawal benefits paid in cash from a taxed fund (like AustralianSuper) will generally be tax-free for those aged 60 or over. This includes both lump-sum and pension payments.
For those aged under 60 years and who are eligible to receive their benefit, the tax treatment of lump-sum withdrawals is divided into a tax-free and a taxable component.
||No tax payable
|Taxable (includes the Medicare levy*)
- If aged under 55, taxed at 21.5%
- If aged between the preservation age and 59 years, the first $180,000 is tax free and the balance is taxed at 16.5%
* From 1 July 2014, the Medicare Levy will increase from 1.5% to 2%.