What payments can or should be made under an account-based pension (ABP), and at what intervals?

In each financial year, the total amount of pension payments that a pensioner may receive is not subject to a maximum limit, although it must be at least the minimum annual payment amount.  Schedule 7 to the Superannuation Industry (Supervision) Regulations 1994 (Cth) sets out the minimum annual payment amount, which is determined by the pensioner’s account balance and the prescribed percentage factor for their age.  The pensioner’s age at the commencement date and on each 1 July thereafter is used to determine the percentage factor.

In each financial year (unless the pension commences between 1 June and 30 June) the pensioner must receive at least one pension payment.  If the pension commenced between 1 June and 30 June, there is no need for any payment in the financial year in which the pension commenced.

The minimum annual payment amount must be pro-rated when the commencement date of the pension is other than 1 July, having regard to the number of days the pension is payable in that financial year.

So long as the pensioner has a positive pension account balance, pension payments must continue throughout the pensioner’s lifetime.

Payments under an ABP can be paid as agreed by the trustee from time to time (i.e., annually, quarterly, monthly, etc).