Pension check ups now due

Now is the time to ensure that pension payment limits will be met for the 2014/15 financial year.

For account-based pensions – it is necessary to ensure that that there has been at least one pension payment and that the minimum pension limit has been or will be satisfied by 30 June 2014.  

For transition to retirement pension – it is necessary to ensure that there will be at least one pension payment and that the minimum pension limit has been or will be satisfied by 30 June 2014.  Additionally, it is necessary to ensure that the maximum pension limit (10% of the pension account balance at the start of the pension or 1 July, whichever is the later) will not be breached.

Any potential pension underpayments must be identified and corrected and any pension overpayments (which only affect transition to retirement pensions) are returned to the superannuation fund.

While the ATO has provided some latitude in relation to pension underpayments, it is far better not to be placed in a position where the good grace of the ATO is required to be engaged.

Finally, pension payments must actually be paid – accruing the payment will not be sufficient.