VIC Why Can't Superannuation be Rolled Over to SMSF?

[Roybyn]

We have recently been going through the process of establishing a SMFS. We have sought the services of a professional financial planner and liaised with our accountant and banker.

We are planning to purchase land with our SMSF, reduce personal debt and then purchase further farming land. However when our financial planner went to facilitate rollover of my superannuation from PSS to SMSF, he was advised I was not eligible to do so!

I am not longer a contributing member to PSS. I ceased employment in federal government in 2009. Why can I not roll this over? Can I appeal this?

Why would my financial planner not have realised this at an earlier time? It is going to seriously affect how we were planning to utilise funds and I am very unhappy and feel we have been ill-advised.

 

[Victoria S]

This is what the Commonwealth Super Corporation website states:

"Can members roll out to a self managed super fund (SMSF) or non-government/private super fund?

It depends on the member type:

Contributing member any age

No. Contributing members cannot roll out any part of their PSS benefit.

Preserved member under 55

No. Preserved members of the PSS cannot roll out their benefit to a SMSF or non-government/private super fund.

Preserved member over 55

If the member is retired from the workforce or over 65 they can roll out their PSS benefit to a SMSF or non-government/private super fund.

If the member is not retired from the workforce and under 65 they cannot roll out to SMSF or non-government/private super fund."

I'm guessing your financial planner should have been aware of that.

 

[Jacqui Brauman]

I agree with Victoria S.

Jacqui
Jacqueline Brauman, Nagambie Lawyer: Book Online | LawTap

 

[Myrna]

If the financial planner does not regularly advise on PSS or defined benefit funds, then I would see a FP who does. Any defined benefit planner would counsel against a client taking funds out of PSS as a 100% lump sum when they are eligible, barring perhaps a single person with a terminal prognosis.


No matter what they want to do with it, based on the calculation factors, the return of a lifetime guaranteed indexed pension to the PSS member, with a subsequent 67% reversionary indexed pension to the spouse or partner of either gender for the rest of his/her life in the current economic environment cannot be replicated outside PSS in either debt reduction, property, SMSF or other investment IMHO.

Obviously depending on circumstances a portion (or all) as lump sum when eligible may be legitimate but the member needs to be very clear what they are foregoing.

This is information only, not advice, I am not a lawyer and no longer a financial planner, retired after decades experience in CSS/PSS.