What the super housing measures mean for SMSFs

Self-managed super fund (SMSF) members will be able to use their voluntary super contributions to buy their first home or make a contribution into their super from the proceeds of the sale of their main residence. The law for these new measures was passed by Parliament in December 2017.

The First Home Super Saver Scheme

The First Home Super Saver (FHSS) Scheme allows SMSF members to save faster for a first home by using the concessional tax treatment available within super.

From 1 July 2018, SMSF members can apply to release their voluntary concessional and non-concessional contributions made from 1 July 2017, along with associated earnings to help buy their first home.

Members must be 18 or over to apply to the ATO for the release of these amounts.

They can apply to withdraw voluntary contributions made since 1 July 2017 of:

up to a maximum of $15,000 from any one financial year, or,

$30,000 across all years.

Members will also receive an amount of earnings that relates to these contributions.

The downsizing measure

SMSF members who are 65 or over and exchange a contract for sale of their main residence on or after 1 July 2018 may be eligible to make a downsizer contribution of up to $300,000 into their super.

This downsizer contribution won’t count towards their contributions caps or total super balance test in the year it’s made. However, it will count towards the transfer balance cap and be taken into account for determining eligibility for the age pension.

The downsizing measure can only be accessed once – it can’t be used again to sell a second main residence.

If an SMSF member chooses to make a downsizer contribution, they’re not required to purchase another home.

SMSFs must ensure the member's contribution has satisfied all relevant conditions and completed the downsizer contribution form before accepting a downsizing contribution.

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