Hi Brains Trust,
Looking for some guidance on a situation with a current client - I am a Financial Adviser.
Note: using simple rounded numbers for ease.
Date 1/1/2024
Client is 63 & working, currently has a TTR in place for $500,000 & Super balance of $100,000.
Pension Payments: YTD 1 July - 31 Dec paid $20,000 (Annual $40,000 max 10%).
Based on TTR 1 July 2023 Balance of $400,000.
Scenario: Client has renovation work coming up and wants to withdraw maximum funds to cover cost.
1/1/2024 Current TTR balance $500,000
1/1/2024 Current Super balance $100,000
1/1/2024 Total balance $600,000.
I have been advised by the Super fund that they will allow for a 10% withdrawal if a new TTR is commenced with the combined funds = $60,000. This means that the client would take $80,000 for FY24.
The Super fund has however advised that "generally it’s been understood advisers don’t follow this strategy as standard 1 of the code of ethics requirement to comply with the spirit of the law….which is one 10% withdrawal per annum."
Can I get some guidance from the ATO?
If this is 'not in the spirit' then how much is the client allowed to take to comply?
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