The purpose of super is to help fund your retirement, so there are rules around when and how you can start withdrawing it, as well as the tax that may apply. When it comes to tax on withdrawals, there are two main parts that make up your superannuation balance – the taxable component and the tax-free component.

The tax-free component of your super includes your after-tax contributions and any government co-contributions. Taxation of the tax-free component is simple – apart from some minor exceptions¹, it leaves your super account tax-free.

The taxable component of your super generally includes your employer (SG) contributions, salary sacrifice contributions, personal contributions you’ve claimed a tax deduction for, and all investment earnings. The tax treatment of the taxable component depends on whether you’re over or under age 60.

The following table shows how the taxable component of any lump sum withdrawals from your super account is generally taxed:

Your age	Tax treatment for 2025-26
If you’re aged 60 and above	No tax is payable
If you’re under age 60	Maximum rate of 22%

^{Note: The taxable component of a lump sum withdrawal may sometimes contain a smaller subset called a taxable component (untaxed element). This is often the result of super from older untaxed super funds run by Commonwealth, State or Territory governments, as well as life insurance proceeds paid into a super fund. We have not considered the taxation of these amounts in the table above.}

Assuming you are aged over 60 (which is generally the case for those receiving income stream payments), no tax is payable on income stream payments.