Payments out of super
Amounts coming out of your super account can include taxes, fees and insurance premiums, not to mention your benefit or income stream payments when you reach preservation age.
Taxes
Super is typically taxed at three different stages:
- On employer (including salary sacrifice) and self-employed deductible contributions made into your super account.
- On investment earnings while your savings are held in your super fund.
- On your retirement savings when they are withdrawn from your super if you are younger than 60 when you take your super benefit.
Fees
Super funds may charge their members a range of fees, including:
- Fees when money moves into or out of the fund (entry, contribution, withdrawal and termination fees). These fees are usually deducted from the member’s account.
- Management costs (the fees and costs of managing your investment). Depending on the particular cost, it will typically be deducted directly from the member’s account or from investment earnings before crediting to the member’s account.
- Service fees (for example, investment switching fees). These fees are usually deducted from the member’s account.
Over time, the amount you pay in fees can affect the amount you save, so it’s important to understand the fees you are paying.
Comparing one fund’s fee structure with another has been made easier with the introduction of enhanced fee disclosure requirements for super funds. See the 'Fees and other costs' section of a fund’s Product Disclosure Statement (PDS) for an explanation of the fees charged, when and how they are paid, and a worked example based on an account balance of $50,000.
Download a copy of TWUSUPER's Member Information Booklet
Insurance premiums
Most super funds must offer at least basic insurance cover against death and total and permanent disablement. Many also offer income protection insurance cover. The cost of cover is usually deducted directly from a member’s account in the fund.
Read about TWUSUPER's insurance arrangements.