In recent weeks, I have been involved in two mediations where a solution was achieved because of the availability of Transition to Retirement (TTR) Pensions.
Both were relationship mediations.The first, which I convened, involved a small asset pool with no cash and no capacity to borrow.The second,where I represented a party, involved a much larger pool with substantial superannuation, but again no cash and no capacity to borrow because of the absence of security.
In each case a settlement was possible because of the capacity of a party to access a TTR pension to pay cash to the other party.
Parties over 55 who are still working can access their super by means of a TTR providing the Superannuation Trust Deed allows for same as otherwise an amendment to the Deed is necessary.
My understanding is that they must access at least 4% and not more than 10% of the total sum held in any financial year but advice should be sought on these limits.
After age 60,provided the person has set up the TTR pension which is simple to do,then withdrawals are tax free.
Withdrawals are not restricted to weekly sums but can be in larger amounts provided the annual limits are not exceeded.
I would strongly suggest that if you are within the relevant age bracket, that you see your accountant regarding implementation and conditions of a TTR pension.
The accountant can also advise on any applicable tax rates and limits which may apply.
This is a simple way of thinking outside the square to reach a solution at mediation.
Mike Emerson of Brisbane Mediations
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