Updated: Apr 2, 2020
Who’s eligible for income support, individual payments and temporary early release of superannuation?
You’ve likely heard that the Australian Government has released a series of stimulus payments to support individuals and households during the Coronavirus (Covid-19) pandemic.
The official statement from the Aus Government can be found here. There are a lot of fact-sheets and info to sift through, so we’ve gone ahead and simplified the key information for you to know WHO is eligible to receive WHAT financial assistance.
Remember: If you have any questions that aren’t answered or need further advice don’t hesitate to reach out. We’ve opened up a number of online bookings for you here.
Who is eligible for individual income support?
The Government has temporarily expanded the list of people who are eligible to receive fortnightly income support payments. A new, time-limited Coronavirus supplement has been created to be paid at a rate of $550 per fortnight. The payments are set to last for at least the next 6 months and the normal one-week waiting period to apply has been waived.
Who can apply to receive this payment?
Existing and new recipients of -
Youth Allowance Jobseeker
Parenting Payment (Partnered and Single)
Farm Household Allowance
A number of people are set to lose (or have already lost) their usual source of income during this crisis. Payments for permanent employees who are stood down or lose their jobs; sole traders; the self-employed; casual workers; and contract workers who meet the income tests can access payment from 27 April 2020.
New applicants are encouraged to claim through on-line and mobile channels as the fastest way to apply and start receiving payments. Read the full fact sheet here.
What households can receive support payments?
Two separate payments of $750 will be available to eligible households. The payment is aimed at increasing the demand and confidence in domestic spending, i.e. buying and supporting local.
So who of the 6.6M recipients is eligible?
Social Security Cardholders
Income Support Recipients
Eligible Concession Cardholders
The first payment will be made from 31 March 2020 and the second payment will be made from 13 July 2020. An individual can be eligible to receive both a first and second support payment. However, you can’t receive it more than once in each round. No double-dipping. The second payment is also not available to those receiving the individual income support payment of $550 per fortnight.
There are a number of concession cardholders who are eligible to lodge a claim for these payments. The full list and further info can be found on this fact sheet.
Who can draw $10K early from their Superannuation?
Some people who are affected by the Coronavirus crisis will be able to access up to $10,000 from their superannuation from mid-April.
Who is eligible to draw on their super early?
People who are currently unemployed
Are those eligible to receive the individual income assistance
Youth Allowance for Jobseekers
Parenting Payments (single and partnered)
Farm Household Allowance
People who were made redundant on or after Jan 1st 2020; or had their working hours reduced by 20% or more
Sole traders who have had business suspended, or have had a reduction in turnover of 20% or more.
Some important details to consider when withdrawing Superannuation early:
Withdrawing Super early is never a decision to be taken lightly and should be a last resort.
Remember: You are ‘selling’ at a loss. Investment losses are only real when you sell or crystalise them. By withdrawing from your Super you may be selling out of the shares and property investments within your fund.
For example - Jane has $100K in her Super. However, it’s recently dropped 20% to $80K due to the economic downturn. If Jane withdrew $10,000 after her Super had fallen 20%, that money would not be there to rebound in the market - which is a material loss of $2,500 after the market bounced back. If Jane foregoes all future returns on that $10K at 35 years of age, she will miss out on an additional $67,000 of returns by retirement (assuming a 7% rate). That’s a lot more than $10K.
The full details on eligibility for early release of Superannuation can be found in this fact sheet.
Who benefits from the temporary reduction of Superannuation drawdown and Social Security deeming rates?
Aimed at providing support for retirees with account-based pensions and similar products, the government is temporarily reducing Superannuation minimum drawdown requirements. This will hopefully reduce the need to sell their investment assets to fund usual minimum drawdown requirements.
The Government is also reducing Social Security deeming rates in recognition of the impact of the low-interest rates on savings. This is largely based on the age of the pensioner, the full table of ages and rates can be found in this fact sheet.
We understand and empathise with the pressure that many people and families are under in these trying times. If you require financial advice or quite frankly are just a little lost with how to access any of these payments, don’t hesitate to reach out.
Here’s how you can contact us:
Book a video or phone appointment here.
Call us on 03 9801 882 or email email@example.com.