Opting out of PSS membership

What is opting out 

Opting out lets you stop making contributions to PSS and have future super contributions paid to another super fund instead. 

In some cases, opting out also lets you claim your PSS benefit while continuing to work for the same employer. Opting out of PSS does not itself entitle you to claim a benefit; you must meet a condition of release.

Important

• If you opt out, you can’t rejoin PSS in the future. 
• Your decision to opt out is final and can’t be reversed. 

Who can opt out 

You may be eligible to opt out if you are:

• a contributing PSS member (including members who have elected to contribute at 0%), or 
• on approved leave without pay that counts towards service for super purposes. 

You can’t opt out if you’re:

• a preserved PSS member
• on leave without pay that doesn’t count towards service for super purposes
• receiving a PSS pension
• a member whose account was established due to a family law split.

What happens to your super contributions

When you opt out, both you and your employer will stop making contributions to PSS. Your future employer super contributions will then be paid to another eligible fund.

What happens next depends on your eligibility:

• If you’re eligible to join PSSap, you’ll automatically become a member PSSap*, or
• If you aren’t eligible to join PSSap, you may choose an alternative complying super fund, provided your employer agrees to make contributions to that fund on your behalf.

*After joining PSSap, you can later choose to contribute to a different complying fund.

You should talk to your employer or seek independent financial advice before opting out. Your PSS membership won’t cease until you’ve joined another super fund. 

What happens to your PSS benefit? 

Once you opt out, your PSS benefit is preserved. The taxed component will continue to grow at the fund earning rate and the untaxed component will accrue in line with CPI until you’re eligible to claim it. For more information see Preserving your super. 

If you opt out before reaching your minimum retirement age (usually 55), you’ll have the same benefit options as a PSS contributing member when you later leave Australian Government employment. 

This applies if you:

• resign
• are retrenched, or
• would have been entitled to a benefit following the sale of a government asset. 

If you claim your benefit after reaching your minimum retirement age, it will be treated as a preserved age retirement benefit. 

If you opt out at age 65 or over, your PSS benefit is payable immediately, even if you continue working. Your PSS benefit stops earning interest 3 months after opting out when you are over the age of 65. If you do not claim your benefit within 3 months of opting out, you also lose the option to take your benefit as a pension. Your only option will be to take your benefit as a lump sum.

When you can claim your benefit if you opt out

If you’re age 55 or over, you may be able to claim your PSS benefit after opting out, even if you keep working with your employer. 

To claim your benefit after opting out, complete the Preserved age retirement application. 

Age 55–preservation age 

You must stop an employment arrangement and have no intention of becoming gainfully employed again. 

Preservation age–64 

You must either:

• stop your current employment or 
• stop one employment arrangement while continue in another employment arrangement

Age 65+ 

• You must claim your benefit as soon as practicable after opting out. 
• If you don’t claim your benefit within 3 months of opting out, you may lose the option to take your benefit as a pension. 

*Gainful employment means being employed or self-employed full-time or part-time for gain or reward for at least 10 hours per week. 

How to opt out

• Complete the Election to cease membership application form and return it to your employer.
• If you’re eligible, your employer will set up your PSSap account.
• If you aren’t eligible, you should join another complying super fund before submitting the form.

Once everything is processed:

• CSC will preserve your PSS benefit and email you confirmation.
• Any requested transfers are usually finalised in 10–15 business days.

If you’re eligible to claim your benefit after opting out, you’ll need to submit the Preserved age retirement application to CSC.