Using your super for dental treatment: early release on compassionate grounds

You can apply to use your super for dental treatment in Australia, but only in limited circumstances. The Australian Taxation Office (ATO) can release superannuation early on compassionate grounds when the treatment is needed for a life-threatening condition or to relieve acute or chronic pain or mental illness, it isn't readily available through the public health system, and you can't pay for it any other way. You apply to the ATO first, then your super fund pays out. The money can be taxed.

This guide sets out the rules as Australian super funds and a medical defence organisation describe them. We couldn't read the ATO's own pages for this article, so check the current rules with the ATO before you apply. This is general information, not financial or tax advice.

Who can use super for dental treatment

According to MDA National, a medical defence organisation, the treatment must meet two conditions.

It must be necessary to:

• treat a life-threatening illness or injury, meaning one likely to result in severe degeneration or death within 12 months
• relieve acute or chronic pain
• relieve acute or chronic mental illness

And it must not be readily available through the public health system.

HESTA, an industry super fund, lists further conditions set by the ATO:

• you are or have been an Australian citizen or permanent resident, or a New Zealand citizen
• you can't afford the expense any other way, such as from savings, a mortgage redraw, selling assets or borrowing
• you can provide supporting evidence, and invoices or quotes for the expenses

Australian Retirement Trust says dental expenses can be released if they're medically necessary, and that the ATO considers dental treatment case by case and only releases super in limited circumstances.

The evidence you'll need

Evidence	Who provides it
Reports supporting the treatment	Two medical practitioners, at least one a relevant specialist (MDA National)
Quotes or invoices for the treatment	The treating practice
Proof you can't pay another way	You, as part of the application
Evidence of the relationship, if applying for a dependant	You (HESTA)

HESTA says the release can also cover transport to and from treatment, for you or a dependant.

How to apply, step by step

1. Get the treatment plan and quote. You need quotes or invoices for the expenses. Our guide to reading a dental quote shows what an itemised quote should include.
2. Get the practitioner reports. Two medical practitioners need to support the application, one of them a relevant specialist.
3. Apply to the ATO. HESTA says you can apply online or with a paper form from the ATO.
4. Wait for the decision. HESTA says the ATO typically takes 14 days for online applications and up to 28 days for paper ones. Australian Retirement Trust says it can take as long as a month.
5. Apply to your super fund. Once approved, send your fund the ATO approval letter with the fund's own application form. The fund pays the money into the bank account you nominate, according to Australian Retirement Trust.

The amount released is limited to what's reasonably needed for the expense, and to the balance you have available, says HESTA.

Tax on super released early

HESTA says money withdrawn early from super can count towards your assessable income. If you're under 60, it's usually taxed at 17 to 22%. If you're over 60, it's generally tax-free. Australian Retirement Trust says it withdraws extra to cover the tax, so the approved amount reaches your bank account after tax.

Every dollar you take out also comes out of your retirement savings, so it's worth talking to your fund or a licensed financial adviser before applying.

Using super for dental treatment overseas

This is the part to check most carefully. We couldn't find current ATO guidance on overseas dental treatment in the sources we could read, and the ATO's own pages blocked access for this article. Ask the ATO directly before you plan a trip around early release.

MDA National notes that doctors may need to think carefully before supporting an application for treatment overseas, and warns that supporting one could imply they approved the overseas treatment if it goes wrong. Expect your doctors to ask why the treatment can't be done in Australia.

The Australian Dental Association's position is that Australian residents should have elective dental care in Australia, and that anyone considering overseas treatment should first get advice from an Australian dentist. It also notes that complications from elective treatment overseas are not always covered by travel insurance or Australian health funds.

Before you apply

• Check that your treatment is needed for one of the medical reasons above
• Confirm it isn't readily available through the public dental system
• Get an itemised treatment plan and quote
• Ask two medical practitioners, one a relevant specialist, whether they'll support the application
• Check the current rules with the ATO, especially for treatment overseas
• Work out the tax and the effect on your retirement savings

If you're comparing treatment at home with treatment in Vietnam, our guides to whether dental tourism is worth it and paying for treatment in Vietnam cover the full costs, including travel and follow-up.