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FAQs
How do I know which pension product is right for me? How much can I receive from my Retirement Pension or Transition to Retirement Pension? How often is my Retirement Pension or Transition to Retirement paid? How is my payment taxed? Can I withdraw extra funds from the Retirement Pension or Transition to Pension? How much will I receive from a Term Allocated Pension? Can I withdraw extra monies from my Term Allocated Pension (TAP)? How often is my TAP payment made? Is there a cost to move from my BUSS(Q) account into a pension account? What happens if I do not make an investment choice? How is my money invested? How are earnings applied to my account? Can I switch investment options? How is the unit value determined? What happens when I make withdrawals from my account? What happens to my fund if I die? Does BUSS(Q) offer Binding Death Nominations? How do I know which pension product is right for me?
BUSS(Q) provides members with a Financial Planning Service to help you make these decisions. FREECALL 1800 657 216 and ask to speak to a Money Solutions financial adviser.
How much can I receive from my Retirement Pension or Transition to Retirement Pension?
The Federal Government has set annual minimum and maximum income levels for Retirement & Transition to Retirement Pension payments. The levels are based on your Pension account balance and your age. You decide annually how much you wish to receive between these limits in each pension payment for the next year. BUSS(Q) will automatically calculate these levels for you when your standard Allocated Pension commences. You will also be advised in writing each financial year of the revised levels.
Click to view the table.
Pension Calculator
A Standard Allocated Pension Calculator will soon available on our website. The Calculator enables you to use various assumptions about earning rates and inflation so that you can determine an appropriate amount to be invested.
How often is my Retirement Pension or Transition to Retirement Pension paid?
You can have you Standard Allocated Pension payments deposited directly into your bank, building society or credit union account monthly, quarterly, half yearly or yearly. You must receive at least one payment per year, and the payment must be at least the minimum percentage for your age.
You can change how your pension payments are made to you and the amount you receive at any time by contacting the BUSS(Q) Pension Hotline on 1800 736 746. How is my payment taxed?
You will not pay tax on the deductible amount of your pension. The deductible amount is a tax-free amount for which you may be eligible. The deductible amount is calculated by taking your undeducted contributions and dividing by the applicable life expectancy at commencement of this pension.
If the reversionary pension option is chosen then the life expectancy factor is either your life expectancy, or the life expectancy of your reversionary beneficiary, whichever is the longer. Click here to view table.
Can I withdraw extra funds from the Retirement Pension or Transition to Retirement Pension?
Your Retirement Pension offers you income flexibility. You can, if necessary, withdraw extra income as lump sum amounts in addition to your regular pension payments. Lump sum withdrawals may be taxed. The minimum withdrawal is $1,000.
However, you cannot withdraw a lump sum from a Transition to Retirement Pension until you have met the preservation requirements.
If your pension account contains benefits of less than $1,000 you will be asked to withdraw the balance as a lump sum withdrawal. You will be notified in writing if this occurs.
How much will I receive from a Term Allocated Pension?
Annual payments will depend upon your life expectancy. There is some flexibility – you can choose a term anywhere between your life expectancy as set out in the Life Tables and your life expectancy as if you were up to five years younger.
You may also choose a term which is equal to age 100 less your age at your last birthday. For example, if you are 65 years old at the commencement of the TAP, you can select a payment factor based on you life expectancy at age 65; or you can select a payment factor based on your life expectancy as if you are aged 64, 63, 62, 61 or 60.
Alternatively you can use a factor of 35, which represents 100 minus 65.
If you decide at the start of your pension that your payments will revert to your spouse in the event of your death. If your spouse is younger than you are, you can if you wish base the payment factor on you spouse’s life expectancy. Again, the option is there to choose a factor based on an age of up to five years younger than your spouse’s actual age or to use the age 100 minus your spouses age at their last birthday.
For example, if a member is age 65 and his wife is 60, the member’s options are:
- Choose a term between 17 and 35 years (which are the life expectances of a 65 and 60 year olf male respectively as well as age 100 minus 65; or
- Use his wife's life expectancy, and choose a term between 25 and 40 years (which are the life expectancies of a 60 and 55 year old female respectively as well as age 100 minus his wife’s age at her last birthday).
The annual payment is calculated by dividing the account balance at 30 June each year by the payment factor based on the remaining term. While the payment factor is fixed, you are able to request that the yearly payment you receive is varied by plus or minus 10%. This option will be offered to you as at 1 July each year. Click here to view table
Can I withdraw extra monies from my Term Allocated Pension (TAP)? Generally, lump sum withdrawals cannot be made from a TAP. The exceptions are that withdrawals can be made:
• Within the first six months of the commencement of the TAP;
• To purchase another complying pension;
• To pay a superannuation contribution surcharge; or
• To make a payment split under family law.
How often is my TAP payment made?
Payments need to be made at least annually. You can have your payments deposited directly into your bank, building society or credit union account monthly, quarterly, half yearly or yearly.
Is there a cost to move from my BUSS(Q) account into a pension account?
No. As BUSS(Q) does not pay commission to anyone to give advice about BUSS(Q) and its products. There is no fee to transfer to a BUSS(Q) pension product.
What happens if I do not make an investment choice?
If you do not wish to make a choice, the Trustee will invest your monies in the BUSS(Q) Balanced Growth Investment Option.
How is my money invested?
An Investment Committee, appointed by the Trustee makes recommendations to the Board about where the Fund’s monies should be invested. The Investment Commited and the Board obtain professional investment advice from Frontier Investment Consulting. Please click here for Frontier's Monthly Update.
Assets are allocated within ranges set by the BUSS(Q) Board after consultation with its investment consultant. The Board reviews these ranges on a regular basis.
Specialist investment managers are interviewed and selected for each of the asset classes. They are selected on the basis of management and performance criteria. They are required to report on a regular basis and a continuously monitored.
How are my earnings applied to my account?
When you invest in the BUSS(Q) Standard Allocated Pension or Term Allocated Pension, you buy a number of units in the investment option of your choice. The number of units you receive depends on the value of the units (the “unit price”) at the date they are bought.
The value of your investment from then on depends on the number of units that you have, and the value of those units – much like owning shares.
For example, if you have $150,000 to invest in the BUSS(Q) Standard Allocated Pension or Term Allocated Pension Balanced Growth option on 1 July when units in that option are valued at $1, you will start your Standard Allocated Pension with:
Initial Investment: $150,000
Value of Units at 1 July: $1
Number of Units Bought: 150,000 If on the 1 August, the unit price has increased to $1.01, then you will have:
Number of Units: 150,000
Value of Units: $1.01
Value of your investment: $151,500
Can I switch investment options?
BUSS(Q) gives you the flexibility to switch your investment option or mix of options at no extra cost.
Switches are effective from the day following the declaration of the next weekly unit price. For example, if your election is received on 27 January, as the unit price is updated on 31 January, your switch will be effective from 1 February.
To change your investment selection you need to complete and return a Member Investment Choice form. Please allow at least up to five working days to process your application. You can also change your investment selection online by logging into MemberAccess and following the prompts.
You will receive a letter of confirmation of your swtich following the receipt of your Member Investment Choice form.
How is the unit value determined?
The unit value is determined by taking the value of the relevant option, deducting the investment management changes, then dividing the value of the net assets by the total number of units issued for that option. The unit price is calculated as at the last working day of each month.
What happens when I make withdrawals from my account?
When payments are made from your Standard Allocated Pension or Term Allocated Pension, you are really withdrawing a number of units. For example, if a payment of $5,000 is made to you from your Standard Allocated Pension when the unit price is $1.01, then you will have:
Withdrawal: $5,000
Number of Units Withdrawn: 4,950.5 at $1.01 per unit
Number of Units Remaining: 145,049.5
Value of your remaining units: 145,049.5 x $1.01 = $146,500
What happens to my fund if I die?
You have two options as to how your BUSS(Q) Standard Allocated Pension and/or Term Allocated Pension will be paid if you die before your account balance runs out:
Option 1 – As a lump sum to your nominated beneficiaries
Your nominated beneficiaries could either be one or more of your dependents or your estate. You can change or cancel your nomination at any time by advising BUSS(Q) in writing. If you choose to have your benefit paid as a lump sum, the Trustee will decide to whom it is paid. However, your nomination is important as it will act as a guide to the Trustee.
The BUSS(Q) Trustee is bound by the Trust Deed and Government regulations as to how they can distribute your account balance. The Trustee recommends that you keep your will updated at all times. Option 2 – As a pension to your reversionary beneficiary
You may nominate a reversionary beneficiary who will automatically receive your pension if you die. You can choose only one reversionary beneficiary and you cannot remove or change that beneficiary in the future. Should you wish to cancel your beneficiary, you will be required to cancel your account and roll over your money to another account.
If you nominate a reversionary beneficiary, they must be your dependent. A dependant includes a spouse, child or any other person who is wholly or partially dependent on you at the time of your death.
Does BUSS(Q) offer Binding Death Nominations?
Yes. Binding Death Nominations means that you can request BUSS(Q) in the event of your death, be bound by the nomination you make on your form when they are paying out your death benefit. Provided that your nomination is a valid one, BUSS(Q) will be obliged to pay any death benefit entitlement to the person or people you have nominated on your form.
Currently, in the event of your death, BUSS(Q) will always take into account any nomination you have made, but will not be obliged to pay your benefit to those you have nominated. BUSS(Q) has that discretion because they are obliged to take into account all potential beneficiaries at the time of death claim. In addition, many people do not update their nominations when their personal circumstances change – for example, if they were to divorce or have a child. For your binding nomination to be valid, certain conditions must be met – please contact BUSS(Q) on FREECALL 1800 657 216 for further information.
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