“Unfortunately, these circumstances do not meet the grounds for compassionate release,” the ATO stated.

“Access to superannuation for severe financial hardship can only be requested by members to their funds.”

In order to release benefits under severe financial hardship, the ATO said funds need to be satisfied that the member cannot meet reasonable and immediate family living expenses, has been receiving relevant government income support payments for a continuous period of 26 weeks, and is receiving that support at the time they applied to the trustees.

“The payment must be a single gross lump sum of no more than $10,000 and no less than $1,000 (or a lesser amount if the member's benefits are less than $1,000). Only one payment is permitted in any 12-month period,” the Tax Office stated.

Alternatively, if the member has reached their preservation age plus 39 weeks, the super fund needs to be satisfied that the member has been receiving relevant government income support payments for a cumulative period of 39 weeks since reaching their preservation age and was not gainfully employed on a full-time or part-time basis at the time of applying to the trustees, said the ATO.

“If a fund releases benefits under these circumstances, there are no cashing restrictions.”