How To Access Your SMSF Money

Taking money out of your SMSF is known as “cashing of benefits” and can be done through a lump sum payment, or via either a pension / annuity. 
The main benefits of using a pension over a lump sum payment include – Tax free income stream (over 60’s) instead of paying tax at marginal tax rates if the capital is invested outside of super. Your assets remain protected inside your SMSF, the pension receives favorable assessment under the centrelink income test. 
The main disadvantage is that you will need to continue to pay the annual admin and audit costs associated with running your SMSF. 
The most common solution is for members to use a pension, but take out smaller lump sums if and when they need them.
Before you can take money out of your SMSF you first need to meet a condition of release. There are many different release conditions such as:

Preservation age

Once you have received the preservation age, have ceased working and do not intend to work again you can satisfy a condition of release.  The exact preservation age is dependent on when you were born, however anyone over the age of 65 meets this requirement.

Death or Terminal Medical Condition

Upon death, and other circumstances such as diagnosis of a terminal medical condition, permanent incapacity all benefits may become unrestricted. 

Other grounds for early release

Other grounds such as financial hardship, compassionate grounds, temporary resident leaving Australia also exist and may form grounds to satisfy the condition of release.
If you are ever unsure of what to do, it is always best to ask first. Contact Real Wealth – for all your SMSF needs – we are Here To Help.
Posted By David Orth