Transfer balance cap

The transfer balance cap limits how much you can transfer into a retirement phase income stream. The general transfer balance cap is currently $1.9 million (2024/25) and it applies to all retirement phase income streams, including:

• Account based pensions, opens in new window.
  
• Transition to retirement, opens in new window pensions that are in retirement phase, opens in new window, and
  
• Defined benefit pensions.

Your transfer balance amount is calculated using a credits and debits system. Super money transferred into a retirement phase account will increase your transfer balance amount. Conversely, any lump-sum withdrawals – known as commutations – you make from a retirement phase account will reduce your transfer balance amount.

Investment earnings you may receive won’t impact your transfer balance amount, even if they take your balance in retirement phase over $1.9 million (2024/25). Also, pension payments won’t reduce your transfer balance amount.

If you exceed your transfer balance cap, you may have to:

• remove the excess from one or more retirement phase income streams, and or
  
• pay additional tax.