Definition, eligibility and evidence for borrowed amounts

What is a borrowed amount

A borrowed amount refers to any debt where a balance remains outstanding and must be repaid. Examples of financial arrangements are:

• amounts borrowed from family or friends
• amounts loaned by a commercial lender (banks or other lenders)
• credit card debts
• amounts owed to 'pay later' services.

As part of your application, you need to provide us with the details and terms of the arrangement.

Eligibility conditions for repaying borrowed amounts

Before applying to access your super, you need to consider what options you have to repay some or all the borrowed amount.

To access your super on compassionate grounds to repay borrowed amounts, all the following conditions need to be met:

• Condition 1 – You or your dependant meet all the eligibility conditions to access your super on compassionate grounds.
• Condition 2 – You or your dependant borrowed money for the purposes of paying for an eligible expense.
• Condition 3 – The borrowed amount was used to pay for the expense.
• Condition 4 – The borrowed amount remains outstanding in part or full.
• Condition 5 – You don't have the financial capacity to repay the outstanding balance on the terms you agreed to or obtain a full or partial replacement loan.

Where these conditions are met and you can provide the required supporting documents, we can consider approving a release to repay the outstanding balance of the borrowed amount.

Amounts that are not eligible

Any interest, administrative fees or penalties charged on the borrowed amount can't be considered for a release on compassionate grounds.

Expenses paid using borrowed money

In addition to the documents required to provide evidence of your or your dependant's eligibility for the expense, you need to provide additional documents about the borrowed amount.

The documents you need will differ depending on whether you or your dependant:

• borrowed money from family or friends
• got a loan from a commercial lender
• used other lenders or financial arrangements
• paid by credit card.

Borrowed from family or friends

If you or your dependant borrowed money from family or a friend, your application must include the following documents:

• a quote or invoice for the expense
• a paid invoice, receipt, bank account or credit card statement showing the expense has been paid
• a statutory declaration from both yourself or your dependant and the lender about the amounts borrowed
• any written contracts or agreements that detail the terms of the arrangement (see loan documents).
• If you don't provide the right evidence your application will be delayed or not be approved.

Loans from a commercial lender

If you or your dependant got a loan from a commercial lender, your application needs to include the following documents:

• a quote or invoice for the expense
• a paid invoice, receipt, bank account or credit card statement showing the expense has been paid
• a statutory declaration about the amounts borrowed from yourself or your dependant.
• loan documents between yourself or your dependant and the lender.

If you don't provide the right evidence your application will be delayed or not be approved.

Other lenders or financial arrangements

If you or your dependant has borrowed money or got a loan from any other entity, your application needs to include the following documents:

• a quote or invoice for the expense
• a paid invoice, receipt, bank account or credit card statement showing the expense has been paid
• a statutory declaration about the amounts borrowed from yourself or your dependant.
• any written contracts or agreements that detail the terms of the arrangement (see loan documents).
• If you don't provide the right evidence your application will be delayed or not be approved.

Paid by credit card

Where you paid for your expense via a credit card, we can only approve the expense amount less any repayments made to the credit card after the payment date of the expense.

If your total repayments are more than the cost of the expense, we will not be able to approve any amounts for release.

If you or your dependant has used a credit card to pay the expense, your application needs to include the following documents:

• a quote or invoice for the expense
• credit card statements showing the date the expense was paid and any repayments made to the credit card after that date
• a statutory declaration from both yourself or your dependant about the amounts borrowed.

Evidence requirements

Loan documents

We need evidence about the terms and payment of any loans from commercial lenders or other entities. This evidence can include:

• the loan contract with the terms and conditions of the loan (including any information about repayment requirements and the charging of interest and fees)
• the loan statement that shows
  • the opening balance of the loan
  • the date on which the loan was provided
  • payment of the amount to your or your dependant's bank account
  • any repayments that have been made
  • any interest or fees that have been charged
  • the account owner's name
• your or your dependant's bank statement that shows
  • the incoming payment from the loan account to your personal account, including payment date
  • payments to the loan provider, including the payment dates
  • the account owner's name.

Statutory declarations about amounts borrowed

Applications about releasing super to repay borrowed money require statutory declarations to be provided as a supporting document.

You can make a Commonwealth statutory declarationExternal Link via the paper form or through your myGov account. You can also use any State or Territory statutory declaration form, so long as it meets the requirements of the Act it is made under.

Declaration by you or your dependant

When providing a statutory declaration about amounts borrowed, the declaration from yourself or your dependant must include the:

• amount borrowed or debt incurred
• lender's name
• date received
• intended use of the borrowed amount or debt incurred
• outstanding balance of the borrowed amount that you aren't able to repay by other means
• details of why you can't make repayments as per the agreed terms
• details of other funding options (see condition 4) you have considered and why they aren't available.

Declaration by the lender (family or friend)

You also need a statutory declaration from the lender that includes:

• the amount loaned
• who it was paid to
• how it was paid
• the date paid
• the intended use of the loaned amount
• any terms and conditions for the amount loaned, including any information about repayments requirements and the charging of interest or fees
• the outstanding balance of the loaned amount.