A super lump sum paid to a member aged 60 years or over is generally tax free. But for those under 60 years of age, some tax is payable.
A benefit when it is paid can comprise of both taxable and tax free amounts.
Taxed Amount = usually made up of concessional contributions that has paid 15% tax inside of your SMSF. This money has not been taxed at marginal rates of taxation, so it must be reported by the recipient.
Tax Free Amount = usually made up of non-concessional contributions that have already paid the marginal rate of taxation outside of Superannuation. These amounts will always remain tax free in the hands of the recipient.
There is a lifetime lump sum payment that can be taken from your SMSF that does not attract taxation regardless of age and taxable component. In order to qualify for this limit, the lump sum must be withdrawn after the member has met a full condition of release. They may or may not have already commenced a pension.
This lifetime limit available for the 2013/2014 year is $180,000.