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Re: Are FHSS non-concessional contributions tax deductible?

Newbie

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If I put $10k (after tax/ non-concessional) into my super this year, can I claim that $10k as a tax deduction AND also have it included in my FHSS amount? Or is it one or the other?

Thanks

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Most helpful response

Devotee

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If you choose to not claim a tax deduction, the contribution remains non-concessional and you are able to withdraw the full $10,000 for FHSS.

 

If you choose to claim a tax deduction, the contribution becomes concessional.  It will be taxed at 15% within the fund.  You would only be able to withdraw $8,500 of that amount for FHSS.

 

Claiming a tax deduction is the better option for most people as they would save more than $1,500 in personal tax when claiming a $10,000 deduction for the contributions.  

 

If the contribution is concessional you will also need to pay tax on the amount you withdraw.  You receive a 30% tax offset on that amount, so the net amount of tax payable would be a small amount if you income is in the 34.5% marginal tax range.

 

This page from the ATO website contains further details.

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Most helpful response

Devotee

Replies 0

If you choose to not claim a tax deduction, the contribution remains non-concessional and you are able to withdraw the full $10,000 for FHSS.

 

If you choose to claim a tax deduction, the contribution becomes concessional.  It will be taxed at 15% within the fund.  You would only be able to withdraw $8,500 of that amount for FHSS.

 

Claiming a tax deduction is the better option for most people as they would save more than $1,500 in personal tax when claiming a $10,000 deduction for the contributions.  

 

If the contribution is concessional you will also need to pay tax on the amount you withdraw.  You receive a 30% tax offset on that amount, so the net amount of tax payable would be a small amount if you income is in the 34.5% marginal tax range.

 

This page from the ATO website contains further details.

Devotee

Replies 0

Hi JarrodM

 

Yes, you can claim a tax deduction for the $10,000 and also have it included in your FHSS amount.

 

But as Glenn4802 says, this would reduce the amount that can be released from super to $8,500, as the contribution would become part of the fund's taxable income once you advise them that you're intending to claim a tax deduction for it. This part of the fund's income is taxed at 15%.

 

But unless you're on a low income you'll end up ahead overall once you receive a tax refund thanks to the deduction. ie unless you're on a low income you'll receive more than $1,500 as a tax refund so you'll have more savings overall.

 

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