Superannuation Retirement Income Streams

Non-Commutable Account Based Income Stream (Accumulation Phase)

A non-commutable account based income stream (also referred to as a ‘transition to retirement pension’) is an account based income stream that you can commence once you have reached preservation age (currently between 55 and 60, depending on when you were born) and where you have not ceased employment.

Although it works in a similar way to a normal account based income stream (as previously outlined) three additional conditions apply:

  • you generally cannot make lump sum withdrawals;
  • earnings do not enjoy the tax-free status of pension phase but instead are taxed at 15%; and
  • your pension income must be between 4% and 10% of the account balance each year.

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) and is counted under the Transfer Balance Cap.