Paying pensions – the importance of planning ahead

Paying the minimum pension amount is a fundamental requirement to ensure an SMSF receives the appropriate tax concessions for meeting the pension standards.  In the 2020/21 Financial Year the
minimum pension has been reduced by 50% as a means to assist in the preservation of capital as a result of the COVID-19 pandemic and the economic impact it has had on superannuation assets,
amongst other things.  Whilst the measure is a welcome relief to some, who consider the minimum to be above their needs, others will continue to draw down benefits at prior year rates to meet their income needs or they will take over and above the minimum under the premise that you can’t take it with you.

To read this bulletin in its entirety download the PDF version here.

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