Tax on pension income

All superannuation and pension payments made to members aged 60 and over are tax-free. Find out here the amount of tax you pay on your pension income.

What taxes apply to my pension income?

The amount of tax you pay on your pension income depends on your age.

Age 60 and over

Your pension income is tax free.

Under age 60

Taxation will depend on the two components that make up your pension:

• the taxable component, and
• the tax-free component.

The taxable component of your pension payments is included in your assessable income and taxed at your marginal rate.

A 15% offset is available to reduce the tax payable on the taxable component of your pension if you have reached your preservation age. Each pension payment is made proportionally from your tax-free components and your taxable components.

UniSuper will deduct the required rate of tax from your regular pension payment and send you a PAYG Payment Summary each year to lodge with your annual income tax return. Please note if we do not have your tax file number (TFN), we may be required to deduct tax at a higher rate.

A Flood levy of up to 1.0% may also apply for the 2011/12 financial year. For more information, refer to the Flood reconstruction levy in 2011/12 fact sheet.

For further information you should refer to Your guide to pensions.