Both pay you a regular income from your super. The difference is whether you've retired: that changes the tax on earnings, how much you can take out and when you can take a lump sum.

Reviewed 31/10/2026. General information only, not personal advice.

Side by side

• Who can start one: Transition to retirement (TTR) pension: People who've reached preservation age (60) and are still working. Account-based pension (retirement phase): People who've met a full condition of release, such as retiring after 60, or reaching 65
• Minimum yearly payment: Transition to retirement (TTR) pension: 4% of the balance (under 65). Account-based pension (retirement phase): Set by age, from 4% under 65, rising with age
• Maximum yearly payment: Transition to retirement (TTR) pension: 10% of the balance on 1 July (or at the start). Account-based pension (retirement phase): No maximum
• Lump sums: Transition to retirement (TTR) pension: Not allowed until you meet a full condition of release. Account-based pension (retirement phase): Allowed at any time
• Tax on fund earnings: Transition to retirement (TTR) pension: Up to 15%, the same as in accumulation. Account-based pension (retirement phase): Tax-free
• Transfer balance cap: Transition to retirement (TTR) pension: Doesn't count until it moves to the retirement phase. Account-based pension (retirement phase): Counts towards the cap ($2.1 million general cap for 2026-27)
• Payments from age 60: Transition to retirement (TTR) pension: Generally tax-free. Account-based pension (retirement phase): Generally tax-free

Why people use a TTR pension

A TTR pension is mostly a tool for the years leading up to retirement:

• Working fewer hours: topping up a reduced salary with pension payments so your income stays about the same
• Salary sacrifice strategy: salary sacrificing more into super while drawing a TTR income, which can be tax-effective for some people
• Easing into retirement: making the change gradually instead of all at once

Why people use an account-based pension

An account-based pension is the most common way to draw an income in retirement:

• earnings on the money in the pension are tax-free
• you choose how much to take, above the minimum
• you can take extra lump sums when you need them
• the balance stays invested, so it can rise and fall with markets

Things to weigh up

• Whether a TTR strategy still adds value for you, given earnings are taxed at up to 15%
• The effect of drawing down early on how long your super lasts
• How much of your super you can move into the retirement phase under the transfer balance cap
• Interaction with the Age Pension, other income and insurance held in super

Figures are from the ATO for 2026-27 and can change each year.

Weigh it up for your own situation

This page explains how the options generally compare. Which one suits you depends on your goals, balance, health, family and the rest of your finances. Book a free initial discussion or call 07 3733 1731. Meet face to face in Eight Mile Plains, or online anywhere in Australia.

Frequently asked questions

Can I have a TTR pension and keep working full time?

Yes. A transition to retirement pension is available once you reach your preservation age (60) while you're still working, full time or part time. You can't take lump sums from it until you meet a condition of release such as retiring or turning 65.

What happens to my TTR pension when I retire or turn 65?

Once you meet a full condition of release, such as retiring after 60 or turning 65, the pension moves into the retirement phase. The 10% maximum no longer applies, earnings become tax-free, and the balance counts towards your transfer balance cap.

Are pension payments taxed?

From age 60, payments from a taxed super fund are generally tax-free, whether they come from a TTR pension or an account-based pension.

Related reading

• Transition to Retirement
• Account-based pensions explained
• When can I access my super?
• Account-based pension vs annuity