Q&A: I’m 63. Can I start a transition-to-retirement pension if I quit one of my jobs?

Q: I am currently 63 and I work 4 days a week as a receptionist in a doctor’s surgery. I also work 2 days a week in the local chemist. I am considering giving up my work at the chemist and then starting a transition to retirement pension from my superannuation fund to supplement my income. Can I commence a TTR once I cease my role at the chemist shop?

A: We need to look here at the conditions of release. When are we allowed to access our super? The answer to your question might be something that you weren’t expecting. Before you withdraw money, you need to tell the fund that you’ve met a condition of release. Based on what you’ve set out in your question, you’ve mentioned that you’re over 60. Because you’re aged 60 or over, we need to look at the condition of release relevant for someone that age. The condition of release says you can access your money when an arrangement under which you’re gainfully employed ceases and you turned 60 before ending the employment arrangement. If I look at the scenario which has been put to us, Angela has attained age 60, and Angela is considering ceasing her arrangement with the chemist under which she’s gainfully employed. The definition doesn’t require all arrangements to come to an end.

It just requires an arrangement to come to an end. If an arrangement under which you’re gainfully employed ends and you’re over 60, all your benefits in your superfund at that time become unrestricted, non-preserved. You don’t need to access your benefits under a transition to retirement (TTR) pension. You could start a standard retirement phase pension, a standard account-based pension. No need for a TTR.

Just keep in mind that the definition says an arrangement under which you’re gainfully employed comes from. It doesn’t require all arrangements. If you cease your chemist work, even though you maintain your employment with the doctor’s surgery, it means you’ve met the retirement definition at that point in time. You could access, as I said, benefits without the need to do a TTR.

But I do want you to keep in mind that any new contributions which go into super after that day and/or fund earnings can’t be accessed. They’re preserved. You can’t take those new monies or earnings until you meet a further condition of release, which might be, “Hey, I’m giving up all work, I’m fully retiring”, or simply turning 65. It’s just an anomaly to be aware of when it comes to the retirement definition.

If you’re over 60, you only need to cease an arrangement, not all. ATO has confirmed all that, and the information is certainly available on their website. Again, if you go into the resources that we have on the website, follow each of these guides around when you can access your super.