Adding to the Pension

Add more money to Pension Phase

Members who are in pension phase have added more contributions to their SMSF. They want to move the contribution into the pension accounts.  There are two options available to them:

Option 1: Starting a new pension

The first option is to set up a new pension with those new funds. You can have as many pension accounts in the fund as you wish.

Option 2: Reset the existing pension

The other option is to reset your current pension. Resetting a pension is simply the process of commuting an existing pension, adding in any additional funds that have been contributed from the Member’s accumulation account balance, then re-commencing the pension with the new, combined balance.

  • Steve Mancini

    Have a question about option 2: reset the existing pension
    Does the process of commuting an existing pension involve the allocation of assets / funds from the pension back into the member’s accumulation mode ??

    • Hein Preller

      Steve,

      There’s 2 ways to account for a pension in an SMSF- either the pooled or segregated approach. We use the pooled approach for all the Funds we administer:

      https://www.smsfwarehouse.com.au/pensions-in-smsf/actuarial-certificate/

      When using the pooled approach for pensions, resetting the pensions or merging all pension accounts into a single pension is only a pension minute. You do not have to transfer physical assets. You can download a template for a pension commencement here:

      https://www.smsfwarehouse.com.au/pensions-in-smsf/

      So you don’t have to move any funds to your accumulation balance.

      Trust this answers your question.

      • Steve Mancini

        We are using the segregated accounts method, so we would have to transfer funds to accumulation balance …..
        Do you also supply resolutions for variation of SMSF deeds (we want to make some minor changes by way of additional rules) and if you do what are the costs

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Superannuation Warehouse is an accounting firm and do not provide financial advice. All information provided has been prepared without taking into account any of the Trustees’ objectives, financial situation or needs. Because of that, Trustees are advised to consider their own circumstances before engaging our services.