Commencing a pension account for your client

We’ll open a pension account for your client when we receive a completed and authorised application form. Once an account is opened, rollovers from other super funds and switches from existing Perpetual accounts can happen.

It’s important to note that your client’s pension won’t commence until all rollovers, switches and contributions noted in the application have been received into the pension account. This may take several days. We may contact you if the amounts we receive vary from the amounts noted on the application. 

For more information, please refer to Switching from super to pension account.

There are several things to be aware of, which are outlined below.

Your client’s pension will commence on the date we receive the final amount into the account. If the final amount received varies from the amount noted on the application form, we may contact you to confirm all funds are received.

Once your client’s pension has commenced, they will receive their pension payments on or around the 15^th of the month (except for fortnightly payments, which will first be paid on or around 14 days post pension commencement). You are then able to amend the payment date to be received on any Business Day of the month, by updating the pension details in Adviser Online. See Minimum Pension Payments for more information.

You can submit a SuperStream rollover request with the external fund or submit a rollover authority request with Perpetual to rollover your external fund into a Perpetual pension account. See Rollovers and transfers for more information.

To open a death benefit pension account on behalf of your client you’ll need to create an account-based pension and contact us to convert it to a death benefit pension. This must be done before any funds are applied to the account.

To convert the new account, you’ll have to provide the following information and documents. This is to ensure that it is compliant and created correctly. We’ll require:

• Tax File Number of the deceased
• date of death
• date of birth of deceased
• name of deceased
• the rollover from an existing death benefit pension  
• a death benefit rollover benefit statement for any rollovers received.

You can view further requirements of opening a new pension account in Open a Pension account for your client.

You can check your client’s pension commencement date in the Pension details tile of the Account details page on Adviser Online.

Prior to the pension commencing, the Pension summary tile in Adviser Online will inform you that “Pension details will appear here once the pension has commenced”.

The commencement value will determine the value that is reported to the ATO for transfer balance cap (TBC) purposes. If there is any change in asset values during the time an asset is transferred into the pension account (or purchased in the pension account) these will all impact your client’s TBC. If income is received or expenses are incurred in the pension, they will also impact the TBC.

Practically, this means that the TBC values reported when rolling out of the previous fund and the values transferred into a pension account may not be the TBC commencement value.

An important consideration is the tax status of the account before the pension commences. In line with ATO guidance, until the pension commences, any income or capital gains made will be taxed as if the account is in accumulation phase. This means that income and capital gains will be taxed at 15% (with 1/3 discount for capital gains where applicable). Please take this into consideration when placing redemptions on a pension account prior to the pension being commenced.

If significant changes to the investment portfolio for a pension account are being made that will crystallise capital gains, these gains will only be tax exempt if the sales are made after the pension commencement date. You can check your client's pension commencement date in the Pension details tile of the Account details page on Adviser Online.

The table below shows the standard minimum payment rates and the reduced minimum payment rates that previously applied under COVID-19 relief measures introduced by the Federal Government:

From the 2023/24 financial year, standard pension minimum rates apply.

If a pension commenced during the year, the pro-rata minimum is calculated by multiplying the minimum annual payment by the remaining number of days in the financial year and dividing by 365 (366 in a leap year). 

If a pension commences on or after 1 June in a financial year, no minimum payment is required for that financial year. 

The Pension details tile within the Account details page of Adviser Online for each client shows their current pension payment details and the minimum pension amount. 

If any of your clients haven’t met their minimum pension requirements by the end of May and don’t have enough available funds in their cash account to meet those requirements, we’ll contact you as you may need to sell down some assets to top up their available cash before the next pension payment. 

If this applies to your clients, we encourage you to perform these selldowns so you can select which assets to sell. 

If there isn’t enough cash or sell orders haven’t been placed to cover your client’s annual pension minimum by a nominated date, we’ll sell down assets to top up their available cash in the following order until there is enough cash for the payment: 

• Daily transacting managed investment(s)
• Australian listed securities
• Term deposits
• Non-daily transacting managed investment(s).

This action is discussed in the product disclosure statement (PDS).

No, any amount above the new minimum that’s already been paid cannot be put back into your client’s pension account. 

If your client would like to contribute funds to their pension account, they must be eligible to make a contribution and have relevant capacity under the contribution cap. Their pension will then need to be refreshed with the contributed amount.