For anyone who has more than $1.6 million in pension phase with just one pension, there’s no need to read further. However, if you are receiving more than one superannuation pension, then read on, especially if you expect your adult children to receive some or all of your superannuation benefits on your death or that of your spouse.
Much of the super change discussion going on at the moment is about reducing pension balances to the transfer balance cap, resetting the CGT cost base for investments and making last minute contributions before the caps drop on 1 July. However, no serious consideration has been given to which pensions should be fully or partially commuted to accumulation phase or withdrawn from the fund as lump sums as part of that process.
Anyone with pensions valued at more than $1.6 million on 30 June 2017 will need to work out which pension or pensions should remain in retirement phase and which should be commuted in full or in part to ensure total pension values are within their transfer balance cap.