As a temporary resident of Australia, you can access your super if you permanently leave the country. Though superannuation is generally only released at preservation age, as a departing temporary resident meeting certain eligibility criteria, you can access your super early. To give you the full picture, so that you can understand the exclusions, conditions and management matters that apply, this post outlines the details below. But the short answer is, if you’re eligible, you can access your super early take it home.
Who can and can’t claim super early if they leave Australia?
If you entered Australia on a temporary working visa under the Migration Act 1958, you can claim super early when you leave the country. Unfortunately, this doesn’t apply if you’re on a visa subclass 405 or 410; an Australian or New Zealand citizen; a permanent resident of Australia or if you hold a retirement visa. That’s because you still have the right to retire in Australia and claim the Age Pension. (New Zealand citizens may be able to transfer Australian super benefits to an authorized New Zealand account.)
“Most temporary residents leaving Australia permanently can claim super early and take it home.”
When can you access super as a departing temporary resident, and what happens if you don’t?
If you’re eligible to apply, you can claim a payment from your super fund after your visa has expired or been cancelled and you have left Australia. Super benefits that aren’t claimed within 6 months of leaving, or within 6 months of the expiry or cancellation of your visa (whichever is later), are transferred the ATO. While you don’t have to claim your super benefits when you leave the country, once they’re transferred to the ATO the money isn’t invested so won’t receive investment earnings. That’s why we recommend that all eligible temporary residents leaving Australia claim their super early.
How much tax will be deducted from your super balance?
When you access your super early this way, the amount of tax deducted depends on the components of your super benefit. Typically for balances consisting of employer contributions, other before-tax contributions and fund earnings on all contributions, tax deducted will be 38% of your super balance. However, from 1 July 2017, a 65% benefits payment tax applies to ‘working holiday makers’. A ‘working holiday maker’ is defined as ‘an individual who holds a Subclass 417 (Working Holiday) visa, a Subclass 462 (Work and Holiday) visa, or certain related bridging visas’.
Need help with claiming super early as a departing temporary resident?
If you believe you’re eligible to access super early because you’re a temporary resident leaving Australia permanently, we can help. You can only submit this claim after you’ve left Australia and your visa has expired or been cancelled, but we recommend you start your application process while in Australia when you have all the relevant information handy. Once you’ve left the country, we can meet via Skype to ensure all the details are correct and you get all benefits you’re entitled to.
“Leaving Australia after working on temporary visa? Don’t forget to claim your super.”
Over to you
Do you have questions about claiming super early as a departing temporary resident of Australia? Get in touch on (03) 9021 6662 to arrange a one-on-one consultation with one of our experts.
The information contained in this article is based on the understanding Proactive Accounting Group Pty Ltd has of the relevant Australian legislation as at 1 March 2017. The information is of general nature only and is intended for use by financial advisers and other licensed professionals only. Advisers should determine the appropriateness of any strategy to the needs of a specific client and the client may need to be referred to their tax or legal adviser prior to implementing any recommendations that you may make based on the information contained in this publication.
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