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First Home Super Saver Schemes

CoreLogic statistics show that the national median house price was $786,000 in May 2024. To purchase a house at that price with a 20% deposit, a buyer must save at least $157,200.<br><br>Of course, a buyer does not always need a 20% deposit. However, this is frequently the amount necessary to avoid paying Lender Mortgage Insurance (LMI) charges.<br><br>While the First Home Guarantee is intended to help you buy a property with a lesser deposit, the First Home Super Saver Scheme allows you to build your deposit while also saving you money on taxes.

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First Home Super Saver Schemes

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  1. First Home Super Saver Schemes Buying your first home is a major milestone, and the First Home Super Saver (FHSS) Scheme can help make it happen by letting you use your superannuation contributions. Get financial advice at Nfinity financials. On This Page: ● ● ● ● ● ● ● ● ● What is the FHSS? Benefits of the FHSS Will You Be Taxed on FHSS Withdrawals? How to Apply for the FHSS Who is Eligible for the FHSS? Financial Hardship Provisions First Home Saver Scheme Contributions How Much Super Can You Withdraw for a House Deposit? FAQs What is the FHSS? The FHSS Scheme lets first-time homebuyers save their deposit within their super fund. Usually, superannuation contributions are locked until you reach the “preservation age” (usually 60), but the FHSS allows you to access your voluntary contributions early to buy your first home. You can withdraw up to $15,000 of your super contributions in a single year, up to a total of $50,000 plus any associated earnings. Only voluntary contributions can be withdrawn, not employer contributions. For more visit us at Nfinity financials. Benefits of the FHSS There are two main benefits of saving for your home deposit within your super fund: 1. Tax Savings: Super contributions are taxed at 15%, which is often lower than your marginal tax rate. For instance, if you earn $100,000 annually, your top marginal tax rate might be 30%. By contributing $10,000 to your super, you'd pay only $1,500 in tax, saving $1,500 compared to your regular income tax. 2. Boost Your Savings: This scheme helps you save more effectively due to the lower tax rate, getting you closer to your home deposit goal. Will You Be Taxed on FHSS Withdrawals?

  2. When you withdraw under the FHSS, you benefit from a 30% tax offset on the amount you take out. Although the exact tax rate can vary, generally, you’ll pay less tax on FHSS withdrawals compared to regular income. How to Apply for the FHSS To use the FHSS, follow these steps: 1. Request an FHSS Determination: This will tell you how much you can withdraw. 2. Submit an FHSS Release Request: Do this before or within two weeks of signing a property purchase contract. 3. Notify the ATO: Within 28 days of signing your property contract, inform the ATO via myGov. 4. Wait for the Funds: It typically takes 15 to 20 business days for the money to be transferred to your account. Who is Eligible for the FHSS? To qualify for the FHSS, you must: ● ● ● ● Be at least 18 years old. Never have owned property in Australia. Not have previously requested an FHSS release (unless the request was withdrawn). Plan to live in the property for at least six of the first twelve months after purchase. Financial Hardship Provisions If you’ve previously owned property but lost it due to financial hardship, you might still be eligible for the FHSS. You need to demonstrate this hardship to the ATO and meet specific conditions. First Home Saver Scheme Contributions You can contribute to the FHSS through: ● ● Concessional Contributions: Pre-tax contributions taxed at 15%. Non-Concessional Contributions: Post-tax contributions with no additional tax. How Much Super Can You Withdraw for a House Deposit? Under the FHSS, you can withdraw up to $15,000 in a single fiscal year and up to $50,000 in total, including earnings. Withdrawals are taxed at your marginal rate minus a 30% offset. FAQs

  3. What if I can't buy a house within a year after withdrawing? You can re-contribute the funds to your super or request an extension from the ATO. Can I use FHSS with other government schemes? Yes, you can combine the FHSS with other programs like the First Home Owner Grant. How do I notify the ATO about my property purchase? Use myGov to inform the ATO within 28 days of signing the property contract. Get Expert Help Considering the FHSS? Book a free consultation call to understand your eligibility, contribution limits, and whether this scheme is the best fit for you. We can guide you through the process and help you make informed financial decisions. For more detailed information, read our related articles or call us at 1300 GET LOAN.

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