As we navigate through COVID-19 and receive updates from the Australian Government on any impacts to Superannuation, you will find the information below.
Early access to your super
The Federal Government is allowing people who are financially affected by the COVID-19 to access a maximum of $10,000 of their superannuation in the 2019-20 Financial Year and a further $10,000 the following Financial Year 2020-21.
While superannuation helps people save for retirement, the Federal Government recognises that some people are significantly affected by the global pandemic and accessing some of their superannuation today may be necessary to alleviate short-term financial hardship.
Our priority is to keep you informed about the changes, help you understand what the changes mean for you and provide support, so you can make the right decisions for your own personal circumstances.
Everyone’s situation and circumstances are different, so it’s important to consider the long-term implications on your retirement savings. Speaking to a financial advisor may help you make an informed decision.
Please note there may be implications for any insurances you have within your super, if you choose to access your super early. For more information click here.
Who will be eligible to access their super?
In order to gain access to your super under the special COVID-19 provisions, you will need to be a citizen or permanent resident of Australia and New Zealand and meet one of the following requirements:
- You're unemployed, or
- You’re eligible to receive a job seeker payment, youth allowance for job seekers, parenting payment (which includes the single and partnered payments), special benefit or farm household allowance, or
- On or after 1 January 2020:
- you were made redundant; or
- your working hours were reduced by 20 per cent or more; or
- if you’re a sole trader—your business was suspended or there was a reduction in your turnover of 20 per cent or more.
You will also need to have accumulation-style super. Early releases cannot usually be made from defined benefit super.
For temporary residents, the eligibility for early release of super in 2019-20 must include one of the following circumstances:
- You hold a student visa that you have held for 12 months or more and you are unable to meet immediate living expenses.
- You are a temporary skilled work visa holder and still employed but unable to meet immediate living expenses.
You are a temporary resident visa holder (excluding student or skilled worker visas) and you cannot meet immediate living expenses
For more information visit the ATO website.
How much can I access and how many applications can I make?
If you are eligible, you can access up to $10,000 of your superannuation in the 2019-20 Financial Year and a further $10,000 the following Financial Year (2020-2021).
Only one COVID-19 application is allowed per financial year. If you apply for less than $10,000 you cannot apply for more funds in the same year, even if the total would not exceed the $10,000 maximum. If you apply for less than $10,000 the difference will not be carried over to the next financial year.
For example, if you apply for release of $6,000 in 2019/20 then you cannot later apply for release of a further $4,000 for the year. In FY 2020/21 you will be eligible to apply again for the release of $10,000 maximum. To access this you will need to make a new application from 1 July 2020 to 24 September 2020.
It is also in the best interest of the customer to know their overall account balance amount before accessing their super early, as account balances that reach $0 (nil) will be automatically closed. As an example, if a customer has an $8,000 account balance and decided to withdraw $8,000 through early access to their super, they will receive these funds but their account will close due to insufficient funds to keep the account open.
For this reason, it is recommended by Virgin Money Super that customers get in contact with an independent financial advisor to discuss all options available to them regarding accessing their super early.
How and when can I apply?
How do I apply?
What you need to do to apply will be determined by the ATO. If you are considering applying for early release of your super, ensure your details are up-to-date. You can do this by logging in to your Virgin Money Super account and updating the ‘Personal Details’ page.
If you are eligible for this new ground of early release, you will need to apply directly to the ATO through the myGov website. You will also need to certify that you meet the eligibility criteria.
When can I apply?
Applications for early release of super are now available for Virgin Money Super members via the ATO. Subject to eligibility.
You will need to lodge your application with the ATO:
- by 30 June 2020 for a 2019/20 release; and/or
- from 1 July 2020 to 31 December 2020 for a 2020/21 release.
Market volatility and your super
As the World Health Organisation categorises the COVID-19 virus as a global pandemic, economic pressures have been experienced globally. Declining consumer confidence is resulting in significant changes across investment markets.
While the world rightly shifts its focus to the health and safety of friends and family, our superannuation partner Mercer has a global team of over 1,200 investment experts who are carefully monitoring international and local markets daily to ensure your retirement outcomes are protected. They will continue to monitor the volatility within the market and adjust investment strategies where necessary.
We remain completely committed to supporting you during these challenging and uncertain times. For more information call us on 1300 652 770, Monday to Friday from 8am to 6pm AEST.
Should I change my investment option/s?
It’s important to remember that super is a long-term investment and is designed to weather short-term investment market changes. COVID-19 is causing market volatility which may prompt you to reconsider your investment strategy. However, switching investment options at a time when markets are low may not be in your best interest.
Virgin Money’s LifeStage Tracker® investment option is designed with a long-term investment period in mind. LifeStage Tracker adapts to market conditions as required, and considers changes to risk tolerances as members move closer to retirement by shifting investment strategies as you age. For Virgin Money Super customers who are invested in one or more of our seven other investment options, these continue to be managed in line with the objectives, risk profiles and time horizons.
If you are considering an investment switch, we recommend you seek financial advice before taking action.
For our Virgin Money Super members, we have a Simple Super advice team that can provide you with instrafund advice at no additional cost. To make an appointment, call our customer care team on 1300 652 770, Mon-Fri 8am-6pm (AEST) apart from public holidays.
How do I change my investment strategy?
If you are considering changing your investment strategy, you can do this by logging in to your Virgin Super account and updating the ‘Investment’ page.
There are separate sections online to update your ‘current investment’ and/or ‘your future contributions’. You must update these separately by clicking the edit button for each investment and following the prompts.
How long does the investment switch take before I can see it?
If we receive the request by 4pm, the investment is generally be processed within two business days after receipt. Your investment change will only appear on once it’s been processed, it doesn’t appear immediately.
You may be asking if you should switch investment options during these ever changing times, or about early access to your super - so here are some FAQs that may help you make the decisions that are right for you.
How will I know that I will get the payment?
After the ATO has processed your application, they will issue you with a determination. The ATO will also provide us with a copy of this determination.
We will then issue you with the payment using the bank details you have provided the ATO when applying for early release. The ATO will also ask you for your permission to pass on your bank details so we can release of the money into that account. We will only pay to the bank details on the determination form and cannot accept these details from you directly. For more information visit the ATO website.
- How do I check my super balance?
What happens if I request $10,000, but don’t have enough in my account?
If your nominated super fund holds less than the amount nominated in a Determination, we are required to pay the amount available, which may be less than the release amount you applied for. This payment may cause your account to be closed and you will be notified at a later date. You will not be able to request the balance from another fund.
Will this affect the tax payable on my current Financial Hardship or Compassionate Grounds Payments that are not yet paid?
No, zero tax only applies to the special COVID-19 releases. Any other release application that is already in progress will be processed under the standard rules, including the tax payable.
Will I need to provide bank statements to be verified?
No, you will only need to supply your bank account details to the ATO on your early release application form and declare they are correct.
What if I don’t receive a determination letter from the ATO?
If you have applied for early release, the ATO will determine your eligibility. Should your application be rejected, you will be notified within 2-3 days via your myGov account. We do not have visibility on the progress of your application, or whether a determination letter has been sent. Should you need an update you would need to contact the ATO directly to follow up.
What happens if my application is rejected?
If your application is rejected then you will be notified via your myGov account in 2-3 days. We will have no visibility of rejections.
Can the release be taken from multiple super accounts?
A release amount can be split across a number of super accounts. You will be able to specify on your myGov application which fund or funds you want the release amount drawn from. If you want to request the release from multiple super accounts, it must be done in the same release form.
Will the super payment be taxed?
No, you don’t need to pay tax on the money released and it will not affect Centrelink or Veterans’ Affairs payments.
Can I return the money into my super if I don’t need it all?
You can make a member contribution back into your super account and this would count towards your non-concessional contribution cap limit.
I have received calls from a third party who has offered to help me access my super and/or assess my eligibility. What details can I provide them?
Never provide information about your superannuation or bank account details to an unsolicited caller. This may be a fraudulent party trying to access your details.
If you believe you have been misled into providing your super details to an unauthorized party, call the helpline immediately on 1300 652 770, Mon-Fri 8am-6pm (AEST) apart from public holidays
If you have also provided any bank details, notify your financial institution immediately.
What is the difference between Current Investments and Future Contributions?
Your current investments is how your super balance is invested today and your future investments refers to how any future contributions will be invested.
For example, your current investment is how your super balance is currently being invested and if your employer pays your super quarterly you may not see your future investments change for three months.
Why is there a delay in declaring unit prices?
Your online account balance doesn’t reflect that day’s unit price, unit prices are not calculated until after the end of the business day.
When you submit a request to switch investment option/s, we apply the unit price set for the day the request is received. If unit prices fall or rise before the change is made, the price fluctuation does not affect your request. You receive the declared unit price for the day your request is lodged.
My investment choice has not been changed on my online account. Do I need to submit the change again? While your switch is effective from the day you submit, it takes up to approximately two business days after we receive your request to be processed.
Your change will only appear once it’s processed, it doesn’t appear immediately. Please avoid submitting multiple requests, as this will slow down the process.
I have submitted more than one investment switch, which one will you process?
If you have submitted more than one request to switch your investments on the same day, before 4pm, we will process the latest request, however, if we receive a request for additional investment switches after 4pm, it will be processed the following day.
COVID-19 was declared a global pandemic on 12 March 2020, does this affect my insurance?
COVID-19 has no impact on the existing Death or Total Permanent Disability insurance cover within your super.
I am about to make an insurance claim, will this be impacted by COVID -19?
COVID-19 has no impact on the existing Death or Total Permanent Disability insurance cover your hold. If you need to make a claim related to COVID-19, like any other claim, you will be assessed and need to meet the eligibility requirements.
My employer said they might need to temporarily shut down the business due to COVID-19. Would my Income Protection policy cover me for this?
Income Protection insurance covers you only if you can’t work due to illness or injury, and you meet the usual terms of your policy. If you are stood down, but you have not had an accident or are not ill, then you cannot make an Income Protection insurance claim.
If you require further information, you can view more information from the ATO website or you can call the customer care team on 1300 652 770, Mon-Fri 8am-6pm (AEST) apart from public holidays.