“If you wind up the fund, you will be commuting any pensions out of the fund – what effect is that going to have on the member’s Centrelink entitlements?” asked Mr Ellem.

“You might think if you’ve got a self-managed super fund, you have too many assets to be entitled to the age pension, but there’s not just the pension, there’s the Commonwealth Seniors Health Card.”

Mr Ellem said many clients do not realise the test for the Commonwealth Seniors Health Card is only an income test, not an asset test.

“Those that held the Commonwealth Seniors Health Card prior to 1 January 2015 and were receiving a pension prior to 1 January 2015, those pensions are grandfathered under the old income test,” he said.

“If you wind up the fund and roll the pension over to another fund, a retail fund for example, you’re going to turn that pension into a post-1 January 2015 pension,” said Mr Ellem.

“Therefore, it will come under the new income test, which may affect the client’s eligibility for the Commonwealth Seniors Health Card."