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Transition to Retirement Calculator

See how a TTR strategy combining salary sacrifice and a pension drawdown can increase your take-home pay and boost your super.

Your details
Result FY 2026–27
Annual Net Gain from TTR
$0
Take-Home (without TTR)$0
Take-Home (with TTR)$0
Tax on TTR Pension$0 (tax-free from 60)
Super Balance Change$0

How a Transition to Retirement Strategy Works

A TTR strategy lets you access your superannuation as a pension income stream once you reach preservation age — 60 for anyone still working in FY 2026–27 — while continuing to work full-time. By combining salary sacrifice (to reduce income tax) with TTR pension payments (to replace the sacrificed income), you can maintain your take-home pay while paying less tax overall.

The Classic TTR Strategy

  1. Salary sacrifice a portion of your salary into super — this reduces your taxable income and is taxed at only 15%
  2. Start a TTR pension drawing the same amount from your existing super balance
  3. Your take-home pay stays roughly the same, but your tax bill is lower
  4. The net result: more money in super after tax, with no reduction in lifestyle

Tax-Free from Age 60

TTR pension payments from a taxed super fund are entirely tax-free from age 60. Because preservation age is now 60 for everyone still in the workforce (anyone born after 30 June 1964), every TTR pension started in FY 2026–27 receives the tax-free treatment from day one — there is no longer a taxed pre-60 phase to model.

TTR Pension Limits

You can withdraw between 4% (minimum) and 10% (maximum) of your TTR account balance per year. For a $400,000 balance, this means between $16,000 and $40,000 per year. Note that since 2017, TTR pension earnings are taxed at 15% (not tax-free as they were previously), which reduces the strategy's benefit slightly.

When TTR Makes Sense

TTR is most effective when you have a significant super balance, are on the 37% or 45% marginal tax rate, and plan to continue working for several more years. It is less effective for lower income earners or those on the 15% rate (FY 2026–27) where the tax differential is smaller.

Frequently Asked Questions

Does a TTR pension affect the Age Pension?
Yes. TTR pension assets are assessed under the assets test for the Age Pension (if you are of Age Pension age). Deeming rules also apply under the income test. If you are under Age Pension age, TTR assets are not assessed. The interaction is complex — seek advice if Age Pension eligibility is a consideration.
Can I make lump-sum withdrawals from my TTR pension?
No. While in TTR phase, you cannot make lump-sum withdrawals from the pension account. You can only take regular pension payments within the 4–10% range. Once you fully retire (or turn 65), the TTR pension automatically converts to a regular account-based pension with no withdrawal restrictions.
Are TTR pension earnings tax-free?
No — since 1 July 2017, earnings on TTR pension assets are taxed at 15% (the same as accumulation phase). Previously they were tax-free. This change reduced the tax benefit of TTR strategies but did not eliminate it, as the income tax savings from salary sacrifice remain substantial.
How do I set up a TTR pension?
Contact your super fund or a financial adviser. You need to have reached preservation age (60), and you'll need to complete a TTR pension commencement form. You can keep your existing accumulation account alongside the TTR pension account, or roll the balance over. Most major super funds offer TTR pensions.
Disclaimer: This calculator provides general estimates of TTR strategy benefits using FY 2026–27 tax brackets. It assumes age 60+, where TTR pension payments from a taxed fund are tax-free. TTR pension earnings have been taxed at 15% since 1 July 2017. This is not financial advice. A TTR strategy should be set up with the guidance of a licensed financial adviser.

Related Calculators

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