Account-Based Pension Drawdown Rate Calculator Australia
Calculate your minimum annual drawdown amount from an account-based pension, estimate how long your super will last at different spending rates, and see monthly income figures. Uses 2026 ATO minimum drawdown factors.
Updated 2026-06-04 — uses 2025-26 ATO minimum drawdown factors (permanent rates, no COVID-19 reduction).
Pension Drawdown Rate Calculator: 2026 ATO Factor Table
This pension drawdown rate calculator uses the permanent 2025-26 ATO minimum drawdown factors published by the Australian Taxation Office and explained on ASIC Moneysmart (the federal government's free financial guidance service). The COVID-19 50% temporary reduction ended on 1 July 2023, so 2026 rates are the standard permanent factors: 4% under age 65, rising in five-year age bands to 14% at age 95+. Your minimum is calculated on your 1 July account balance — withdraw less than the minimum and the ATO removes the fund's 0% retirement-phase tax exemption for that year, exposing earnings to the 15% accumulation tax rate.
How Account-Based Pension Drawdown Rules Work
An account-based pension (ABP) is the most common type of retirement income product in Australia. Once you meet a condition of release (typically retiring after age 60, or reaching age 65), you transfer your super balance into an ABP and begin drawing an income. The ATO sets minimum annual drawdown percentages that increase with age — you must draw at least this amount each financial year or the pension may lose its tax-exempt status. In 2026, the minimum drawdown rates for an ABP (permanent retirement phase) are: under 65: 4%, 65–74: 5%, 75–79: 6%, 80–84: 7%, 85–89: 9%, 90–94: 11%, 95+: 14%.
Transition to Retirement (TTR) pensions have a maximum drawdown of 10% and a minimum of 4% — both limits apply simultaneously. TTR pensions do NOT get the 0% earnings tax exemption until you permanently retire; only retirement phase pensions do.
Tax Treatment of Pension Income
Income from an account-based pension for members aged 60 and over is entirely tax-free when paid from a taxed super fund. There is no tax on the payments, no need to include them in your tax return, and the fund's investment earnings in the retirement phase are taxed at 0% (compared to 15% in accumulation). This makes the ABP extraordinarily tax-efficient compared to holding investments outside super. Members under 60 who have reached preservation age may draw a pension but the taxable component is subject to income tax with a 15% tax offset.
How Long Will Your Super Last?
The longevity of your super depends on three factors: the starting balance, the net investment return after fees and inflation, and the annual withdrawal amount. At the ASFA comfortable retirement standard of $51,278 per year (single, 2026 figures), a $500,000 balance with a 6% net return lasts approximately 22 years. Supplement the ABP with the Age Pension when your assets fall below the means test threshold, as the pension continues even as your super balance depletes. Running the account-based pension alongside a guaranteed annuity is a common strategy to insure against longevity risk.
Pension Phase vs Accumulation Phase Earnings
A key benefit of moving your super into an account-based pension is the 0% tax on investment earnings within the fund. In accumulation phase, earnings are taxed at 15% (7.5% for capital gains on assets held more than 12 months). Once you convert to retirement phase, all earnings supporting pension payments are tax-free. However, from 1 July 2025, the Transfer Balance Cap of $1.9 million limits how much can be held in the tax-free retirement phase. Earnings on super above the cap remain in accumulation phase and are taxed at 15%.
Frequently Asked Questions
What are the minimum pension drawdown rates in Australia for 2026?
The ATO minimum account-based pension drawdown rates for 2026 are: under 65 = 4%, ages 65–74 = 5%, 75–79 = 6%, 80–84 = 7%, 85–89 = 9%, 90–94 = 11%, 95 and over = 14%. You must draw at least this percentage of your 1 July balance each financial year.
What happens if I do not draw the minimum pension amount?
If you fail to draw the minimum amount in a financial year, your account-based pension loses its pension phase status for that year. The fund's earnings would be assessed as accumulation earnings and taxed at 15%. The ATO may require the shortfall to be treated as an accumulation interest.
Is there a maximum amount I can withdraw from an account-based pension?
For a fully commenced retirement phase ABP, there is no maximum — you can withdraw your entire balance at any time. The maximum only applies to Transition to Retirement (TTR) pensions, which are capped at 10% of the account balance per financial year.
What is the Transfer Balance Cap and how does it affect my pension?
The Transfer Balance Cap (TBC) is $1.9 million in 2026. This is the maximum amount you can transfer into a tax-free retirement phase pension account. Super above this amount must remain in accumulation phase (taxed at 15% on earnings). If you exceed the TBC, the ATO will apply excess transfer balance tax.
How do I estimate how long my super will last?
Use the formula: years of balance = log(1 - (balance × rate / annual_withdrawal)) / log(1 + rate), where rate is the net real return per year. For example, $600,000 at 5% net real return drawing $40,000 per year lasts approximately 25 years. Supplement with the Age Pension when eligible to extend longevity.
Can I still receive the Age Pension if I have an account-based pension?
Yes. Your ABP balance counts as an assessable asset under the Age Pension assets test. ABP income is also assessed under the income test using deeming rules. As your ABP balance declines over retirement, you may become eligible for a part or full Age Pension, providing a safety net against outliving your super.
What is the 2026 pension drawdown rate calculator formula?
Minimum annual drawdown = (1 July balance) × (ATO age-based factor). The 2025-26 permanent factors are: 4% (under 65), 5% (65-74), 6% (75-79), 7% (80-84), 9% (85-89), 11% (90-94), 14% (95+). Example: $600,000 balance at age 67 = $600,000 × 5% = $30,000 minimum draw per financial year. The factor uses age on 1 July, not your birthday during the year.
Did the COVID-19 50% drawdown reduction extend into 2026?
No. The temporary 50% reduction in minimum drawdown rates that applied for FY2019-20 through FY2022-23 ended on 1 July 2023. From 2024-25 onward, the permanent factors apply — what this calculator uses. If your super provider is still applying a reduced rate, contact them to update; drawing below the legal minimum forfeits the 0% earnings tax exemption for that year.