FAQs

Frequently asked questions

Death and invalidity benefits

Can I nominate or change my beneficiaries

No, MilitarySuper does not allow members to nominate beneficiaries.

MilitarySuper scheme rules determine who receives your MilitarySuper benefit in the event of your death, which means that MilitarySuper cannot accept binding beneficiary nominations.

Under MilitarySuper rules, in the event of your death your benefit will be paid to any eligible spouse and/or eligible children. An eligible spouse is defined as a person who was living in a marital or couple relationship with you at the time of your death, for a continuous period of three years or more. If you were in a relationship for less than three years, the Commonwealth Superannuation Corporation (Trustee of MilitarySuper) may still declare a spouse to be eligible.

If you don’t have eligible beneficiaries at the time of your death, your MilitarySuper benefit will be paid to your estate. In this case, you can nominate beneficiaries in your will.

For more information see the Death and dependant benefits factsheet [PDF 181 KB].

Do I have insurance cover?

Traditional insurance is not offered through MilitarySuper. However most serving full time members receive death and invalidity cover at no extra cost. This cover is provided under the scheme rules and you do not pay insurance premiums or other fees. You should check your details on Member Services Online to find out how much existing cover you have and whether it suits your current circumstances.

For more information see the Invalidity benefits factsheet [PDF 174 KB].

Can I withdraw my superannuation if I am medically discharged?

If you are discharged from the Australian Defence Force as medically unfit for further service, you may be eligible to an invalidity benefit from MilitarySuper.

Invalidity benefits are designed to help meet your income needs in retirement or resettlement into the civilian workforce. Compensation and repatriation benefits may also be paid to you by the Department of Veterans’ Affairs.

For more information see the Invalidity benefits factsheet [PDF 174 KB].

Financial hardship

I’m in financial hardship; can I access my super now?

If you are no longer serving full-time with the Australian Defence Force (ADF), you may qualify for early access to your superannuation benefits on two grounds – either on the grounds of severe financial hardship or on other specified grounds.

Severe financial hardship may apply if you are receiving Commonwealth Income Support Payments for at least 26 weeks.

Specified grounds (previously known as compassionate grounds) includes treatment of life threatening illnesses, palliative care, funeral and burial expenses, and to prevent foreclosure by a mortgagee. All enquiries regarding applications for early release on these grounds should be directed to the Department of Human Services on 1300 131 060. An application form is also available from their website at www.humanservices.gov.au

In either case, benefits can only be released if you meet the qualifying criteria.

Please note that if you are still a serving member of the ADF, you are only able to access MilitarySuper Ancillary Benefits (if applicable) from your current contributory account. Your Employer and Member Contributions cannot be released early unless you have ceased working for the ADF fulltime.

If you have preserved benefits from a previous period of service, these may be eligible for early release. This could include your Employer and Member contributions, but only from your preserved benefit.

For more information see the Early access to your superannuation benefits factsheet [PDF 142 KB].

Fees and charges

What fees & charges do I pay?

As a member of MilitarySuper, you do not pay any administration fees or member transaction costs. These costs are covered by Defence.

There is an investment management fee known as an Indirect Cost Ratio (ICR) applied to each member’s invested funds.

The ICR reflects the ratio of all investment management expenses as a proportion of the Fund’s total assets. This amount is not deducted from your account but is an approximation of your share of investment management expenses which have been deducted over the year before unit prices have been declared.

Your Member Benefit, Ancillary Benefit and Employer Productivity Benefits are invested and have the ICR applied. The rest of your Employer Benefit is not invested.

The ICR for each investment strategy is updated on the MilitarySuper website. More information can be found under Investment & performance.

Investments

Do the investment option changes/changed investment return objectives impact on my benefit?

The changes have no impact on the determination of benefit entitelments within MilitarySuper that reflect the special nature of service in the ADF.

For information about the impact of investment returns on your benefit, refer to the Investment Options and Risk booklet, available from the PDS page.

I have seen on your website that you have changed investment return objectives and target asset allocations – do I need to do anything?

You don’t need to take any action. You should however review the changes to the investment objectives and the asset allocations. These are available in the MilitarySuper Product Disclosure Statement (PDS) and the Investment Options and Risk booklet available from the PDS page.

As always, you should consider whether any investment option is appropriate for your situation and needs.

Why have the investment objectives changed for some investment options?

CSC changed the investment objectives in March 2013 because it expects that, for the same level of risk taking, average investment returns in the decade ahead will be lower than those generated in the stronger growth environment of the 1980s-2000s. This reflects the ongoing impact of the global financial crisis. As developed economies reduce their debt, growth in economic activity and in corporate earnings is likely to be lower, on average, than the decades preceding the crisis.

CSC believes that it is important to reflect our view on future investment returns into investment objectives. There is no value to members in stating a return objective which CSC believes is unlikely to be met. Reviewing and updating investment objectives allows members to make informed choices about which investment options are most suitable for them, based on those objectives and, importantly, the tolerance for risk within each investment option.

I am a member in the Balanced (pre 30 June) investment option. Why has this been merged with the Growth option (now Balanced)?

CSC is taking steps to reduce the number of investment options offered in schemes for which it is the trustee.  It is doing this so that it can focus its investment effort on a smaller number of investment options which invest across various asset classes. The current Balanced and Growth options invest across the same asset classes.  The Balanced investment option also has a relatively small amount of funds in it compared to the Growth option.  In the interests of providing clearer investment choices for members, reducing the number of investment options that need to be managed and achieving efficiencies associated with that, CSC believes that it makes sense to merge these options. 

Pensions

What is the new CPI rate?

The January 2014 CPI increase is 1.6%

How is the CPI increase calculated?

Please refer to the Pension Update - Issue 23 [PDF 162 KB]

If you would like more information on the CPI rates used in the calculation go to the ABS here

Why is tax taken from my MilitarySuper pension?

MilitarySuper pensions are considered to be taxable income by the Australian Taxation Office (ATO) and therefore we are obliged to deduct tax from your pension according to the relevant PAYG taxation schedules.

We will deduct any tax concessions you are eligible for automatically each fortnight, unless you have advised us that you wish to claim these concessions on an annual basis through your income tax return.

If you think you should not be paying tax on your pension you will need to apply to the ATO for an assessment. You can do this by completing a PAYG income tax withholding variation (ITWV) form available at ato.gov.au and submitting it to the ATO. Once the ATO has provided you with an assessment, you can forward this information to MilitarySuper and we will apply any changes to your tax on the next available payday.

More information can be found in the Tax concessions for pensions factsheet [PDF: 171 KB]

I’ve recently turned 60, will this affect my pension?

Once you turn 60 there may be significant tax changes to your MilitarySuper pension. For more information please refer to the Tax concessions for pensions factsheet [PDF: 171 KB]

Third party (including financial advisors)

MilitarySuper – What type of fund is it?

The Military Superannuation and Benefits Scheme (MilitarySuper) is unique and available only to full-time serving members of the Australian Defence Force (ADF). It is known as a hybrid of both an accumulation plan and defined benefit scheme. A member’s benefit can be made up of a member benefit, employer benefit and an ancillary benefit.

The member benefit consists of personal post tax contributions received on a fortnightly basis. These contributions are mandatory and can be anywhere between a minimum of 5% up to a maximum of 10% of their superannuation salary.

What is the employer benefit?

The level of employer contributions from Defence is determined by the total years and days of full-time service times the final average salary (FAS) recognised for MilitarySuper purposes. For up to 7 years of service the ADF will contribute 18% of the member’s final average salary per annum, from 7 years through to 20 years the ADF will contribute at 23% of the final average salary and after 20 years the ADF will contribute at 28% of the final average salary per annum. These contribution rates will be reflected as an accrued benefit multiple (ABM). For example someone who has completed 20 years of service will have an ABM of 4.25.

The employer benefit consists of two parts:

  1. a taxed component, which is a productivity contribution, 3%, paid by the ADF, plus interest.
    This component is accumulation based.
  2. an untaxed component, paid by the Commonwealth, which is what is left after the taxed component has been subtracted from the total employer benefit. This component is the remainder of the ADF’s contributions and is completely unfunded.

What is the ancillary benefit?

Members of MilitarySuper may also have an ancillary benefit. This component may be comprised of six different types of contributions:

  • salary sacrifice
  • additional personal contributions
  • government co-contributions
  • transfer (or roll in) amounts
  • spouse contributions
  • superannuation guarantee top up contributions.

This component is invested in the member’s choice of investment strategies and may be rolled over at any time (including while a member is currently serving).

What are the fees?

There are no administration fees or charges with MilitarySuper. The only cost associated with a member’s account is the Indirect Cost Ratio (ICR) on the respective investment strategy that the member’s funds are allocated to.

The ICR for each Investment strategy can be located on the website. The following fees DO NOT apply to MilitarySuper:

  • entry/contribution fees
  • account keeping/administration fees
  • exit/withdrawal fees
  • switching fees
  • buy/sell spread.

What are the MilitarySuper benefit options?

MilitarySuper has the option for a preserved member (no longer serving in the ADF full time) to elect to take a pension from the age of 55. The pension is calculated from the employer benefit (not less than 50%) by using a pension conversion factor and is payable for life.

The member may remain working in the civilian workforce and be in receipt of a retirement pension.
The pension is not means tested and will need to be taxed accordingly.

A pension conversion factor is a number determined in the legislation that is used to divide the employer benefit lump sums into an annual pension amount. For example, when taking a pension at age 55 we use a pension conversion factor of 12 to divide into the employer benefit.

Whilst a member is under the age of 55 they are able to roll over their member benefit once preserved (left the ADF) to another Australian regulated superannuation fund. The employer benefit must remain with MilitarySuper until the age of 55 at which time they can take their pension or choose to rollover their benefit. In order to take a cash lump sum the member must have reached their preservation age and be fully retired from the workforce.

How is MilitarySuper taxed?

MilitarySuper members will usually have three different tax components as part of their overall benefits:

  1. Tax Free component – This component consists of compulsory member contributions as well as any post tax ancillary contributions
  2. Taxable Taxed Component – This component consists of the productivity benefit,
    any salary sacrifice or super guarantee top-up contributions and many interest earned
    on the member contributions
  3. Taxable Untaxed Component – Generally the major component of the benefit. This is the unfunded portion of the employer benefit known as the employer share.

A large portion of the employer benefit is classified as defined benefit and will be paid from consolidated revenue when the member is eligible to receive it. The productivity benefit is a portion of the employer benefit that is invested.

The defined benefit portion is not subject to any tax as it is a notional contribution and is therefore an untaxed source. Tax will be payable on this component upon the member claiming the benefit.

What amount counts towards the concessional contributions cap?

The member makes a compulsory post-tax contribution at any whole percentage rate between a minimum of 5% and a maximum of 10% of their superannuation salary on a fortnightly basis. This does not count towards the concessional cap.

The only amounts that count towards the concessional contribution cap are the productivity benefit, salary sacrifice and super guarantee top-up contributions.

  1. Productivity Benefit – The funded portion of the employer’s contribution. It is calculated fortnightly as 3% of the member’s superannuation salary
  2. Salary Sacrifice – Any additional pre-tax contributions made by the member into the fund
  3. Super Guarantee Top Up – Any additional allowances a member receives above their superannuation salary are eligible for the superannuation guarantee from the ADF.
    The contributions are not received fortnightly but are usually reported every 2-3 months.

What amount counts towards the non-concessional contributions cap?

The member makes a compulsory post-tax contribution at any whole percentage rate between a minimum of 5% and a maximum of 10% of their superannuation salary on a fortnightly basis. This amount counts towards the non-concessional contributions cap.

What kind of death benefits, insurances and beneficiaries does MilitarySuper offer?

There are specific death benefits which are built into the MilitarySuper scheme. Whilst the member is contributing to MilitarySuper and a full-time serving member of the ADF, they are covered for the total amount of:

  • their member benefit (including any ancillary benefits)
  • their employer benefit based on the Final Average Salary (FAS) on the date of retirement multiplied by the Employer Benefit Multiple (EBM) they would have received, had they remained in the scheme until their Compulsory Retirement Age (CRA) for their rank. This is usually age 60 unless the member has elected an earlier CRA.

As MilitarySuper does not hold beneficiaries on file, benefits are paid firstly to an eligible spouse and/or child and if there are no eligible dependants there may be funds payable to the estate. If the member dies while receiving a pension and is survived by an eligible spouse, they may be entitled to receive 67% of the member’s pension. This spouse pension would then be payable for the life of the spouse. A child pension is also available for children under the age of 25 in full-time study that are deemed eligible after the time
of passing.

MilitarySuper does not offer Income Protection and there is no insurance company linked with MilitarySuper. Members of MilitarySuper have specific benefits tailored for their career in the ADF.
If members are separated from the ADF on medical grounds they may be entitled to Invalidity Benefits based on their level of incapacitation in relevant civilian employment, this is known as Class A, B or C.

Invalidity Benefits are paid as fortnightly pensions, derived from the member’s projected employer benefit as if they had served until their CRA as outlined in the death benefits. Class A and B pensions may be payable for life depending on the illness/injury and the members skills and qualifications. A class A or B pension will be periodically reviewed to ensure a member is still medically eligible for an Invalidity Pension. Where an invalidity pension is payable, the member will receive this from the time of their separation from the ADF.

  • Class A (60–100% incapacitated)
  • Class B (30–59% incapacitated)
  • Class C (0–29% incapacitated) – No pension benefit is paid and the value of their superannuation upon separation from the ADF is preserved in the fund.

There is also a specific death benefit which is built into their MilitarySuper benefits.

Whilst the member is contributing to MilitarySuper and a full-time serving member of the ADF, they are covered for the total amount of:

  • their member benefit (including any ancillary benefits)
  • their employer benefit based on the Final Average Salary (FAS) on the date of retirement multiplied by the Employer Benefit Multiple (EBM) they would have received, had they remained in the scheme until their Compulsory Retirement Age (CRA) for their rank. This is usually age 60 unless the member has elected an earlier CRA.

As MilitarySuper does not hold beneficiaries on file benefits are paid firstly to an eligible spouse and/or child and if there are no eligible dependants there may be funds payable to the estate.

If the member dies while receiving a pension and is survived by an eligible spouse, they may be entitled to receive 67% of the member’s pension. This spouse pension would then be payable for the life of the spouse. A child pension is also available for children under the age of 25 in full-time study that are deemed eligible after the time of passing.

Do MilitarySuper members have investment options?

The member has control over where their member and ancillary benefits are invested. There are four different investment options varying in risk for each member to choose from. The member does not have to have all funds invested in a single strategy and may invest in multiple strategies at the same time by varying the percentage invested.

The four investment strategies, their ICR’s and asset allocations are outlined in detail in the Investment Options and Risk booklet.

The employer benefit of a MilitarySuper account has two components, a funded portion and an
unfunded portion.

The funded portion of the employer benefit grows in line with the Fund’s default investment strategy (Balanced) and cannot be changed.

Once a member ceases contributing and becomes a Preserved Member the unfunded portion is increased annually by the Consumer Price Index (CPI) to maintain its current value.

I am calling on behalf of a member, how can I get information?

If we have verbal or written authority from the member, we can provide a nominated third party with information on their account.

Verbal authority: Before we can release any information we need to perform an identification check on the member and receive verbal authority to speak with the nominated third party. Verbal authority is only valid for that call.

Written authority: The member can provide a written authority, which clearly states the name of the person/s and firm (if applicable) nominated as a third party.

All requests for written authority must be signed by the member and include at least three points of valid identification that we can match to the member’s file.

Each time you (the third party) calls, you will be asked to provide four points of identification.

Examples of identification include:

  • full name
  • membership or reference number
  • date of birth
  • current address.

Authorities can be scanned and emailed, faxed, or posted to MilitarySuper's administrator, ComSuper. See our contact us page for further information.

I have Power of Attorney (POA) for a member/pensioner? What do I need to do?

You need to post us a certified copy of the Power of Attorney (POA). To be valid, the POA or an attached cover letter needs to contain at least three points of identification, which can be matched to the member’s file and must show the member’s signature.

Each time you (the Power of Attorney) calls, you will be asked to provide four points of identification.

Examples of identification include:

  • full name
  • membership or reference number
  • date of birth
  • current address.

If you wish to make changes to the member’s account, you will need to put your request in writing along with three points of member identification.

Membership, contributions and transfers

If I have not paid contributions for more than 12 months, am I considered a lost member and will my benefits then be transferred to the ATO?

No. 

New lost member arrangements that come into effect from 1 January 2013 do not apply to defined benefit schemes such as the MilitarySuper. Your benefit remains preserved in MilitarySuper until claimed after reaching your preservation age.

However, preserved benefits cannot be left preserved in the MilitarySuper past age 65. Therefore, if you do not claim your benefit when you reach age 65 and ComSuper has not received any money on your behalf for the past 2 years and it has been 5 years since we last had contact from you, then all or part of your benefit may be transferred to the ATO as unclaimed money.

Please make sure the contact details you have provided to us are up to date. This will ensure that you receive regular member statements and other fund updates about your preserved benefit.

How can I change my contribution rate?

As a MilitarySuper member, you must contribute 5% of your fortnightly salary for superannuation purposes into the fund. Contributions can be increased to a maximum of 10%, in multiples of 1%. Your member contributions will be deducted from your pay each fortnight and can be arranged through your pay centre.

If you wish to make additional personal contributions (more than the 10%), or salary sacrifice contributions, you can make these into your MilitarySuper Ancillary account.

To make additional personal contributions, you can contact your pay unit to arrange a deduction from your after-tax salary.

Alternatively, you can make the contributions directly to ComSuper as a cheque or money order. Each contribution must be accompanied by an Additional personal contributions deposit form [PDF 1 MB].

Salary sacrifice contributions can be arranged by contacting Smart Salary.

For more information see contributions.

How much does Defence contribute to my super?

Your employer contributions consist of two components:

  • funded component – which represents the 3% productivity contributions paid as cash into Militarysuper and invested in the Growth Investment Strategy
  • unfunded component – paid by the Commonwealth and is the component which is remains after your funded component is deducted from your employer benefit.

The amount employer contributions paid by Defence are determined by your length of service.   

More information about how your benefit is calculated can be found in the Summary of scheme factsheet [PDF 286 KB].

Is there a limit on how much I can contribute into the fund?

You can contribute as much as you want. However, contributing over the contribution caps will have tax implications.

Concessional caps

The cap on concessional contributions is $25,000 for the financial year 2012-13.The following contributions count toward the concessional contributions cap:

  • any salary sacrifice contributions
  • any Superannuation Guarantee contributions
  • your employer productivity contributions.

Non-concessional caps

The cap on non-concessional contributions is $150,000 per year or $450,000 over three years.

Non-concessional contributions which count towards your cap include:

  • member contributions
  • additional personal contributions.

Information about the tax implications of going over the caps can be found under super contributions - too much super can mean extra tax on the ATO’s website.

Can I claim my member contributions on tax?

One of the criteria to be eligible to make a claim is the ATO's ‘maximum earnings as an employee’ condition.

Under this rule, to claim member contributions paid to MilitarySuper, your assessable income for a financial year from the Australian Defence Force would need to be 10% or less of your total taxable income.

See claiming deductions for personal super contributions on the ATO website for more information about who is eligible to claim their personal super contributions as a tax deduction.

Can I transfer or roll my super into MilitarySuper?

If you are a current contributing MilitarySuper member you can transfer super into your account.

You can do this by completing the  Application to pay in a transfer amount form [PDF 626 KB] and sending it to your other fund for processing. They may require more information or identification from you before processing the transfer.

If you are a preserved benefit member you will not be able to transfer into MilitarySuper.

For more information see roll ins and transfers.

Can I roll out my MilitarySuper?

Your benefit is made up of several components which have different rules attached:

  • Ancillary benefit – Part or this entire amount can be rolled to another complying superannuation fund at any time.
  • Member benefit – Once you discharge from the full-time Australian Defence Force (ADF), you can roll part or this entire amount to another complying superannuation fund at any time.
  • Employer benefit – The employer component (what Defence has contributed) must remain in MilitarySuper until you reach age 55. This amount is notional and is paid out of consolidated revenue when you claim your benefit. No provision exists under current legislation for this money to be rolled into another complying superannuation fund prior to age 55.

Can I still contribute to MilitarySuper if I have transferred to the Reserves?

No, only full-time serving members of the Australian Defence Force (ADF) can contribute or receive contributions into MilitarySuper on their behalf. Reservists are not considered full-time serving members under MilitarySuper legislation. Your contributions will recommence if you re-enlist or return to contributory full-time service in the ADF.

For more information see the Rejoining the ADF factsheet [PDF 159 KB]

Statements

Why can’t I view my Member Statement online?

You will not be able to use Member Services Online to view your member statement if you are:

  • a member who is subject to family law split during the financial year ending 30 June 2012, or
  • a family law associate of MilitarySuper.

You may also have been excluded from receiving a statement if we have received two items of mail ‘Return to Sender’. If you think we may have your incorrect address on file, please call the Customer Information Centre on 1300 006 727 so that we can update your address and request your statement be sent to you.

I think my superannuation salary/rank on my statement is incorrect.

Your annual statement shows the details we have on file as of 30 June 2012. If you undertook higher duties or changed rank after 30 June 2012, this will not be reflected on your statement.

If you want to confirm that we have your correct rank, you can call our Customer Information Centre on 1300 006 727.

Why do I have a negative co-contribution?

We have been directed by the Australian Taxation Office (ATO) to recover co-contributions from members where there has been an overpayment.

If this applies to you, you will notice a negative co-contribution rate reported in your 2011/2012 member statement.

Please call the ATO on 13 10 20 if you have any enquiries.

Why did I receive two statements?

If you had a previous period of service, you may receive more than one statement.

Your contributing member statement will reflect your current period of service (taking into account any previous service for employer multiple purposes) and your preserved member statement will show your accrued benefit for any previous periods of service.

My Employer Benefit multiple is not taking into account my previous service

Your Employer Benefit Multiple is calculated separately for each period of service. Every time a member discharges or transfers to reserve duty, their Employer Benefit is calculated and transferred to a preserved membership.

When a member re-enters full-time service, a new period of service is created with MilitarySuper and your Employer Benefit Multiple resets to 0. However, your previous full-time service is recognised in the new contributing account. This means that you will either start on a higher contribution rate or reach a higher contribution rate sooner.

Is my foreign service recognised?

Recognised foreign service is shown on your Annual Statement. It is located on the first page in the ‘Your Details’ section under ‘Additional service recognised for MilitarySuper’.

Why do I have negative investment earnings?

Superannuation investments are designed to provide positive growth over the long term. However, in the short term, investment values will fluctuate, which may result in positive or negative returns.

It is important to remember that, while diverse investment strategies have been created to provide a balanced investment return, positive returns are not guaranteed and growth will be affected by fluctuations in the global financial market.

Different investment strategies have different projected returns and risks attached. Because of this, we suggest you seek independent licensed financial advice about your investment options.

For more information see investment and performance.

I am separating from my partner - what do I need to do?

Super can be split for family law purposes.

For more information see the Family law and super splitting booklet [PDF 665 KB].

Legislation

Where can I find the MSBS rules?

The rules governing MilitarySuper can be found under legislation.

Investment choice

Must I make a choice?

No, you don’t have to choose your preferred investment option. Your member benefit including any ancillary contributions, plus your future contributions, will automatically by invested in the default option, the Balanced Option.

What is the cut-off time to make my choice?

An election to switch investment options must be received by 3 pm Canberra local time to take effect that working day. If your request is received after the 3 pm cut-off, on a weekend or a public holiday, your switch request will take effect the following working day.

How much does it cost?

Nothing, your choice of preferred investment option is free.

Can I change my mind later?

Yes, you can change your investment option selection at any time.

How many investment options can I choose?

You can choose either one or a combination of the available MilitarySuper options.

You can make one choice for the investment of your current member benefit and another for your future contributions.

I’m not sure which option is best for me; who should I ask for help?

We recommend you find out more about professional financial advice. Ultimately, you should receive professional and impartial advice for your own situation, goals and needs.

Why can’t I choose an investment option for my employer benefit?

As a contributing member, investment returns do not affect your employer benefit. It is based on a set formula involving your length of service and final average salary.

Can I make my choice online?

Yes, you can do it via Member Services Online

When does my choice take effect?

Your investment switch will be effective the date your switch request is received by MilitarySuper, if received prior to 3 pm (EST). Switches received after 3 pm (EST) will take effect the following working day.