Benefits of an Income account - BUSSQ

Benefits of an Income account

A BUSSQ Income account is a way of allowing you to draw a regular, flexible, tax-effective income stream either leading up to, or during retirement.

There are a number of benefits to setting up a BUSSQ Income account

BUSSQ has two of these Pension types – a Transition to Retirement Income account and an Income account.

The Transition to Retirement Income account is often used to help you move from full time to part time work when you near retirement. The Transition to Retirement Income account can make regular payments to you to help fill the gap that your lower pay leaves. The Transition to Retirement Income account is also used by some who remain working full time, but either start to, or increase their salary sacrifice contributions into super. In this case the shortfall in pay can then be met from the Transition to Retirement Income stream. This strategy is one often used, although it doesn’t suit everyone. We are able to provide financial advice to you to help you work out whether this strategy may suit you and your circumstances.

The Income account is used when you have retired. It is created with funds in super that are non-preserved, so you would have already met a trigger of release. For example, you may be over preservation age and permanently retired, or over 60 and have left a job. Or you could have turned 65, working or not. All these are triggers of release. The Income account is more flexible than the Transition to Retirement Income account, as you can make lump sum withdrawals and there is no upper limit on how much you withdraw in regular Income account payments.

In both cases the earnings in these Income accounts are tax free, and in some cases the income that you draw is also tax free. This would apply if you are age 60 or over. If you are under 60 there may be some tax applicable, depending upon your circumstances, but you could also enjoy a tax rebate on some of the income drawn.

From transition to retirement and retirement planning, to superannuation investment options and retirement income stream choices, BUSSQ’s team of income account specialists is here to help. Book in to speak with a Skylight Financial Planner today and get your retirement sorted.

*Transition to Retirement Income account became taxed from 1 July 2017