The Board overseeing Catholic Super and the Board of TelstraSuper have signed a binding Heads of Agreement and agreed to proceed with a ‘merger of equals’ between the two funds.

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Any rates and information listed are current at the date of writing (July 2023) and may change.

Redundancy

When an employee is made redundant, employers may make certain lump sum payments (other than accrued entitlements such as annual leave, long service leave and sick leave) which qualify as genuine redundancy/approved early retirement scheme payments. If these lump sum payments satisfy certain criteria they may attract concessional taxation treatment. 

A portion of the lump sum payment may be excluded from assessable income and is based on the following formula (for the 2023/24 financial year): 

$11,985 + ($5,994 x completed years of service). 

This tax-free limit changes every year. This amount cannot be rolled over. 

If a genuine redundancy/approved early retirement scheme payment is received which is in excess of the tax free amount, the excess is treated as an untaxed ‘employment termination payment’ (ETP). This amount must be taken as a lump sum (unless transitional rules apply). The ETP consists of the following components:

  • A tax-free component comprising of Pre-July 1983 benefits and the invalidity segment. This tax free component is non-assessable and non-exempt (i.e. it is tax free).
  • A taxable component consisting of the remainder of the ETP. The following table outlines how the taxable component is taxed:

 

Under Preservation Age for Entire Payment Year

Reached at Least Preservation Age During Payment Year

Up to the Employment Terminations Cap

($235,000 for 2023/24 FY)

Maximum 32% + Medicare Levy

Maximum 17% + Medicare Levy

Excess Amounts

47% + Medicare Levy

47% + Medicare Levy
Applies where ETP has been received within 12 months of termination of employment.

 

What is my preservation age? 

The following table outlines the preservation age. 

Date Of Birth 

Preservation Age 

Before 1 July 1960 

55 years 

1 July 1960 – 30 June 1961 

56 years 

1 July 1961 – 30 June 1962 

57 years 

1 July 1962– 30 June 1963 

58 years 

1 July 1963 – 30 June 1964 

59 years 

On or after 1 July 1964 

60 years 

Togethr Financial Planning Pty Ltd (ABN 84 124 491 078, AFSL 455010) trading as Equip Financial Planning and Catholic Super is a subsidiary of Togethr Holdings Pty Ltd (ABN 11 604 515 791).  It is a related entity to Togethr Trustees Pty Ltd (ABN 64 006 964 049, AFSL 246383), the trustee of the Equipsuper Superannuation Fund (ABN 33 813 823 017) whose divisions include Catholic Super.

This information is general information only. It has been prepared without taking into account your personal investment objectives, financial situation or needs. It is not intended to be, and should not be construed in any way as, investment, legal or financial advice.

© 2023 Togethr Trustees Pty Ltd ABN 64 006 964 049 AFSL 246383 — *Past performance is not an indication of future performance
We acknowledge all First Peoples of the beautiful lands on which we live and work, and their enduring knowledge and connections to Country. We honour the wisdom of and pay respect to Elders past and present.