Possible future changes
First Home Super Saver Scheme
There is legislation currently before the Parliament to allow for the early release of amounts of superannuation to assist Australians in purchasing their first home.
Because this is not yet passed, we can’t tell you the final shape of the scheme and it may change in detail.
But we do know that it is intended that this apply to voluntary contributions over and above any mandated employer contributions (so above the 15.4% in the case of the PSSap) made from 1 July 2017.
It would be available to persons aged 18 or older who have never owned a previous property or land (including for investment). You can only make one application for release of these amounts per person in total. Contributions made in 2017-18 would be accessible from 1 July 2018.
More generally, there is an upper limit on the total of employer contributions (including salary sacrifice arrangements) and personal contributions claimed as a tax deduction that can be made each year. This is known as the ‘concessional contributions cap’ and eligible contributions that exceed the cap will be taxed at a higher rate. For 2017-18, the cap is $25 000.
There is also a cap on ‘non-concessional contributions’ made into your super fund from after-tax income. For 2017-18 this is $100 000. Again, contributions over this cap attract more tax.
Contributions towards the First Home Super Saver Scheme could be salary sacrifice amounts or after-tax personal contributions. So they will count toward these caps.
Up to $30 000 in contributions can be withdrawn, but there is a maximum of $15 000 in contributions that can come from any one year. For example, if you made a one-off contribution of $50 000 in 2018 and then contributed $5 000 in 2019, you could only withdraw $20 000 - $15 000 from the 2018 contributions and $5 000 from the 2019 contributions. As this amount is below the $30 000 limit, this is allowed. You would not be able to make another application for release in the future.
Any excess concessional contributions are disregarded in calculating how much you can access so you need to keep the caps in mind. When determining the amounts you can access, any post-tax contributions are counted first. Then salary sacrifice amounts are considered.
Contributing towards the First Home Saver will not mean you are allowed to go over the contributions caps.
Another change still before Parliament is aimed at encouraging home owners over the age of 65 to consider downsizing their home and contribute the proceeds of the sale to superannuation.
Again, the detail of this may change as the Bill works its way through Parliament.
This will be achieved by removing the age and work test requirements on contributions where the contribution is derived from the sale of your primary residence (up to a maximum of $300 000). You would need to be the whole or part owner of the property sold and have held it for at least 10 years.
This can only be done once (so it can’t be done again 10 years later). The eligibility requirements are based on the date of exchange of the sale and the scheme is due to commence from 1 July 2018.