Transition to Retirement
Transition to Retirement (TTR) Pension (aka Transition to Retirement Income Stream (TRIS), TTR, TRIS, TRIP!)
A Transition to Retirement Income Stream is a form of pension that is available for members of superannuation funds between their preservation age and 65. If you are born before 1 July 1960, your preservation age is 55, but moves up every year after that (see table below).
A Transition To Retirement allows you to begin taking a pension while you are still working. A Transition to Retirement is relatively simple to start and can be a great strategy to reduce your personal income tax, along with the income tax and capital gains tax assessable in your super fund. If you are over 60 years, there are even greater benefits, as you can salary sacrifice into super (and the super fund only pays 15% tax on the salary sacrifice money coming in), and then withdraw money as a pension (you need to take a minimum pension withdrawal each year) and if you are over 60, this amount you withdraw doesn’t get reported in your personal tax return, it is tax free in your hands. So it can be a great little strategy and one that everyone between 55 and 65 years of age should be considering with their professional advisor.
Please note, this topic is not fully covered and we believe is outside the scope of any website page, so if you are considering starting a pension or want to know more, you need to seek professional guidance.
When can you access your super benefits?
Generally, you must reach your preservation age and/or a condition of release before you can access your super. The following table will assist you to work out your preservation age:
| Date of Birth | Preservation Age |
| Before 1 July 1960 | 55 |
| 1 July 1960 – 30 June 1961 | 56 |
| 1 July 1961 – 30 June 1962 | 57 |
| 1 July 1962 – 30 June 1963 | 58 |
| 1 July 1963 – 30 June 1964 | 59 |
| From 1 July 1964 | 60 |
You must meet a condition of release before your SMSF can pay you a benefit.
Your fund can pay benefits under the following conditions of release, provided the funds rules allow it:
- Retirement
- Transition to Retirement
- Attaining age 65 of more
- Your benefits are less than $200
- Terminating gainful employment
- Terminal medical condition
- Permanent incapacity
- Temporary incapacity
- Compassionate grounds
- Severe financial hardship
- Release of benefits under an ATO release authority.
Please visit this ATO website for more information.
Tax Treatment of Income Stream Benefit
| Age of Member | Tax Free Component | Taxable Component |
| Under preservation age | Non-assessable non-exempt income | Marginal tax rate (less 15% tax offset if disability benefit) |
| Preservation age to 59 | Non-assessable non-exempt income | Marginal tax rate less 15% tax offset |
| 60 Plus | Non-assessable non-exempt income (in other words TAX FREE) | Non-assessable non-exempt income (in other words TAX FREE) |