The ATO has reminded individuals of the timeline they need to recognise if they are wanting early access to their superannuation on compassionate grounds over the Christmas period.
“If you require access to your super before our offices close, you should submit your application as soon as possible. Any applications for compassionate release of super that haven’t been finalised prior to 23 December 2022 will not be assessed until our offices reopen,” the regulator said in an update.
“When you apply, ensure you have all the required evidence ready so your application can be assessed as quickly as possible.
“We recommend you wait for the outcome of your application and ensure you have received payment from your fund before you book the treatment or services that you have applied for.”
It stipulated it cannot guarantee an application will be approved and every case will be judged on its own merit against the legislative requirements.
Further, it reiterated the rules governing the early access of an individual’s superannuation on compassionate grounds. To this end, it stated a person’s retirement savings can only be accessed in circumstances where the individual has no other means of paying the expenses they have due. In addition, the amount withdrawn is limited to the expenses having to be paid.
Situations giving rise to legitimate early access to a person’s retirement savings include having to pay for medical treatment or transportation for the individual or a dependant, making a payment on a home loan or council rates to ensure a property is not lost, having to pay for palliative care for the individual or a dependant, and expenses associated with the death of a dependant.
The regulator also issued a warning in relation to illegal early access of super and financial advisers who may be encouraging people to do so through the establishment of an SMSF.
“These schemes are illegal and there are heavy penalties if you participate,” it said.
Over the Christmas period, the ATO will be closed from noon on 23 December until 3 January 2023.
