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The government’s First Home Super Savers Scheme is in effect. Here’s what you need to know.
The First Home Super Saver Scheme (FHSSS) aims to help Australians save for a first home via extra voluntary contributions into their superannuation fund.
The FHSSS allows aspiring homeowners aged 18 years or older, who have never owned real property in Australia or are experiencing financial hardship, to put some super towards a home deposit.
A single home buyer can make voluntary superannuation contributions of up to $15,000 per year and $30,000 in total, while an eligible couple could contribute up to $60,000 in total.
“From 1 July 2017 you can make voluntary concessional (before-tax) and non-concessional (after-tax) contributions into your super fund to save for your first home.
From 1 July 2018 you can then apply to release your voluntary contributions, along with associated earnings, to help you purchase your first home. You must meet the eligibility requirements to apply for the release of these amounts.”
Here are the key facts of the FHSSS. Further detailed facts can be found here.1
It is important to read the detailed facts provided by the ATO before making a decision to utilise your super fund for first home savings.
No. When the legislation was first proposed, it was limited to apply only to first home buyers. The Australian Government’s Treasury website2 provides more detail about how the legislation may work for first home buyers.
The FHSSS passed by Parliament now applies also to home buyers if the Tax Commissioner determines the taxpayer is suffering “financial hardship”. So you may be eligible if you’re at least 18 years old, and you:
You can make voluntary contributions into your super fund with the intention of using that money for your home deposit, as either a concessional contribution (before tax) or a non-concessional contribution (after tax).
The FHSSS applies to voluntary superannuation contributions of up to $15,000 per financial year and $30,000 in total (or $60,000 in total for an eligible couple) made from 1 July 2017 onwards.
The maximum amount that can be released under the scheme is the sum of your eligible contributions and deemed associated earnings. This amount includes:
It is important to note that the maximum amount that can be released is not necessarily the actual amount you will receive from the ATO. See ‘How can I take the money out’ below for further information.
From 1 July 2018 you can apply to release your voluntary contributions made on or after 1 July 2017, along with the associated deemed earnings, to help you purchase your first home. To withdraw the accumulated funds from your super fund:
Apply to the Commissioner of Taxation for a FHSS determination and release. You can do this online via your myGov account.
Once you have received your determination, apply to the ATO for a release of your savings.
The ATO will issue a release authority to your super fund/s, who will send the requested release amounts to the ATO.
The ATO will withhold the appropriate amount of tax and offset against any outstanding Commonwealth debts.
The ATO will then send the remaining balance to you.
It’s important to read further detailed information here to understand how this process might apply to your personal situation.
It’s important to note that the ATO must have released a FHSS amount to you before you sign a contract to purchase or construct residential premises or you may be liable to pay FHSS tax.
Very importantly, no. Once you have requested a release you can't request another one, even if you have requested an amount less than your FHSS maximum release amount.
The FHSSS applies to a residential premises – but not a houseboat or mobile home. It could include vacant land if you’re going to build on it, but the land must be capable of being occupied as a residence.
And yes, you must live there. You must move in as soon as it’s practical and live there for at least six months of the following 12 months. This is to avoid the money being used to buy an investment property.
Under the FHSSS, you have 12 months after releasing the savings to sign a contract. You would also be able to ask the ATO for a 12-month extension.
Under the FHSSS, if you don’t end up buying a qualifying home within the 12-month timeframe, you must either:
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1 Treasury, 2017, Media release: Turnbull Government delivers leg-up for first home buyers and downsizers, 7 December 2017, accessed 13 December 2017 at sjm.ministers.treasury.gov.au/media-release/129-2017
2 Australian Government, Treasury, ‘Opening more doors for Australians, First Home Buyer,’ accessed 21 March 2018 at homeownership.gov.au/first-home-buyer
3 Source: ATO website. First Home Super Saver Scheme. Accessed 26/6/18.
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