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A new break for first home buyers

29.01.2019 by Neville Hughes

Looking to buy your first family home or get into the housing market? As a result of recent legislation, the Government’s First Home Super Savers Scheme (FHSSS) will allow individuals to save for their first home using their superannuation. Applying this policy will allow potential home owners to reap the benefits of the concessional tax treatment of super, so now you can save even faster than a traditional savings account would allow.

How will it work?

As of July 2017, individuals were permitted to make voluntary contributions into their nominated, pre-existing super account. Upon discussions with your employer, you may be able to make these contributions through your pre-tax income, allowing you to save on tax costs. If this is neither possible nor applicable, you are able to contribute your post-tax income and make a tax deduction claims after.

From 1 July 2018, you can apply to release the voluntary contributions and any associated earnings, to put towards your first home deposit. Is there a limit to how much you can contribute? Yes, you are able to apply to have a maximum of $15,000 of your voluntary contributions from any one financial year included in your eligible contributions to be released under the FHSSS, up to a total of $30,000 contributions across all years. Another benefit to this scheme is that if purchasing the home in question as a couple, you are able to contribute up to $60,000 collectively.

Am I eligible?

In order to take advantage of the policy that will help you buy your first home, you must:

  • Be 18 or over at the time of applying for the release of the money from super
  • Have never owned property in Australia, including a home or investment property
  • Live or intend to live in the property for at least six months of the first 12 months of purchase
  • Not have withdrawn an amount under this scheme before.

What should I be aware of?

  • Non-concessional contributions must be released before any concessional contributions
  • Super guarantee contributions, spousal contributions and government co-contributions cannot be released
  • You have up to 12 months to sign a contract to purchase or construct a home. If you do not you may apply for a 12 month extension, recontribute the amount to your superannuation fund, or keep the released amount and be subject to the 20% FHSSS tax
  • You must have received release amounts from the FHSSS before you sign a contract to purchase or construct a residential premise
  • When making contributions into your super you must remember that you can only withdraw 85% of concessional (pre-tax) amounts
  • It will take approximately 12 business days to process your request to release any amount under the FHSS Scheme
  • All associated earnings plus any concessional contributions in a withdrawal will be taxed at their marginal tax rate with a 30% non-refundable tax offset.

For further information please visit the ATO website.




This information is general information only. You should consider the appropriateness of this information with regards to your objectives, financial situation and needs.

GTC Financial Services Pty Ltd ABN 69 596 897 575 is a Corporate Authorised Representative of Infocus Securities Australia Pty Ltd ABN 47 097 797 049 AFSL and Australian Credit Licence No. 236523


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Topics Personal Financial Planning, First Home Buyer

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