Once a condition of release has been met, the SMSF is able to pay benefits to a member as a pension.
There are two types of pensions that can be established in the SMSF:
Please note: These conditions apply until another condition of release is met, such as reaching age 65. After this point, if retained, it is referred to as a transition to retirement pension (pension phase).
*Note: The Government is temporarily reducing minimum drawdown requirements for account-based pensions and similar retirement income stream products, including transition to retirement pensions, by 50% for the 2019–20 and 2020–21 financial years. This has been extended for the 2021–22 financial year. Therefore, the minimum pension income will fall to 2%.