Minimum Pension Payments 2010

Written on 24th March, 2010

Transitional measures: Reduction in annual minimum payments for the 2010 financial year

The Federal Government is providing temporary relief for individuals receiving payments from income streams by halving the minimum drawdown rate payable on income streams for 2010.

The relief applies to allocated pensions, account based pensions, market linked pensions (term allocated pensions) and transitional to retirement income streams. Where an income stream in commenced part-way during the current financial year, the pro-rata minimum is based on the reduced percentages.

The minimum payment percentages for the financial year ending 2010 for certain age groups are as follows:

AGE	PERCENTAGE FACTOR FOR 2010
Under 65	2%
65-74	2.5%
75-79	3%
80-84	3.5%
85-89	4.5%
90-94	5.5%
95 or more	7%

CALCULATE YOUR OWN PENSION

Account based pensions have a prescribed minimum annual payment and no maximum (unless it is a transition to retirement income stream). The minimum annual payment is calculated as follows:

Account balance x percentage factor

(Rounded to the nearest $10)

Pro rated minimum

For pensions purchased after 1 July and before 1 June of a financial year, the minimum amount is pro-rated in that year for the number of days. The number of days will include the commencement date of the pension.