Although the General Transfer Balance Cap is increasing to $2.1 million, your Personal Transfer Balance Cap (Personal TBC) may be very different.
The Key Rule:
Once you commence your first retirement-phase income stream, your personal cap becomes linked to your own transfer balance history.
This Means:
If you’ve already used part of your cap, future increases are generally only proportional.
Example:
According to the Soraka example on page 4:
- Pension started before 1 July 2026 with $700,000
- Used cap percentage: 35%
- Unused cap percentage: 65%
- Indexation received: $65,000 instead of $100,000
Important Insight:
Starting retirement phase even one day earlier than necessary may permanently reduce future cap flexibility.
Common Misunderstanding:
Many assume commuting pension amounts later “resets” their cap. It generally doesn’t — proportional indexation is based on highest historical transfer balance, not current balance.
Disclaimer and Warning
The information above is of a general nature only. It should not be used as a source to make financial decisions. It’s also important to note that the legislation and figures related to this topic tend to change regularly and therefore the information above may not reflect the current status. We recommend that if you are looking for advice on this matter, you should contact us.