When you start a Transition to Retirement income stream (a pension while you still work), there are certain minimum amounts to withdraw. The maximum amount is 10% of the account balance.

Depending on your age, you must withdraw a minimum amount from your Account based Pension each year. Due to the economic effects of COVID-19, the government has halved the percentage of minimum pension payments for the 2020, 2021, 2022 and 2023 financial years.

See the table below for percentages linked with different age categories:

Age of recipientPercentage Factor (2020/2021/2022/2023)
Under 652%
65 – 742.5%
75 – 793%
80 – 843.5%
85 – 894.5%
90 – 945.5%
95 or more7%

With the global financial crisis in 2009, the minimum percentages were lowered. This enabled Members to preserve more capital in the SMSF. The historical minimum percentages are set out below:

AgePrevious Year Percentage Factors
2008 FY2009 -2011 FY2012-2013 FY2014-2019 FY
Under 654%2%3%4%
95 or more14%7%10.5%14%

1. The 4% minimum is the normal percentages that apply for minimum pension draw down

2. Minimum amount calculated on 1 July each year for the transition to retirement regular payment

3. In the first year of the account-based income stream, work out the minimum payment pro-rata on effective days in the year

4. Minimum amount to be rounded to nearest $10

5. These minimum amounts are set out in the Superannuation Legislation

To start a Pension or Transition to Retirement, Trustees need to minute this decision. Please see a template of a pension commencement minute below

To read more on Pension payments from an SMSF, read the ATO booklet here:

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