• 98 Online
  • 23304 Members
  • 27269 Posts

ATO Community

FHSS - Withdrawal Amount Question

Ask a question
Highlighted

I'm new

Views 722

Replies 2

Hi All,

 

I was reading through the ATO website (https://www.ato.gov.au/Individuals/Super/Super-housing-measures/First-Home-Super-Saver-Scheme) and specifically under the section 'Maximum Release Amount' states the following:
"The FHSS maximum release amount takes into account the $15,000 limit from any one year and $30,000 total limit to the total contributions across all years when calculating the eligible contributions, before adding the associated earnings."

I was hoping to seek clarification on this statement particularly in regards to how associated earnings affect the withdrawal limit. Does this mean that a total of $30,000 in contributions can be withdrawn, and based on this maximum withdrawal amount, the earnings are added on top of this figure? Further to this is there any reason why someone couldn't theoretically reach the contribution cap and let the account acrue interest? 

 

Kind Regards,

 

A Youth

1 ACCEPTED SOLUTION

Accepted Solutions

Best answer

ATO Certified

Moderator

Replies 0

Hi @Nathan2110,

 

Thanks for your question.

 

When you request a First home super saver (FHSS) scheme determination, we'll work out the maximum FHSS amount you can withdraw from your super. This is called the maximum release amount.

 

The maximum release amount is the sum of your eligible FHSS scheme contributions and the associated earnings on these contributions. The maximum release amount includes:

  • 100% of your eligible non-concessional contributions
  • 85% of your eligible concessional contributions, and
  • the associated earnings on both your eligible concessional and non-concessional contributions.

There is also a limit on how much of your eligible FHSS contributions you can withdraw from your super fund, with a limit of $15,000 of eligible contributions from any one financial year, and a limit of $30,000 of eligible contributions in total. 

 

As @SebReiter mentioned, associated earnings don’t count towards the $30,000 limit. We calculate the associated earnings using a specified rate when you request a determination. This means the amount we calculate may be different from the amount your contributions earned while they've been in your super fund.

 

As an example, let's say you contribute the following personal (non-concessional) contributions to your super fund for the FHSS scheme:

  • $20,000 in the 2017/2018 financial year, and
  • $20,000 in the 2018/2019 financial year.

In the 2019/2020 financial year, you request a determination and we calculate the associated earnings as $2,000.

 

In this example, your maximum release amount would be $32,000. The maximum release amount would be made up of $15,000 of eligible contributions from each financial year ($30,000 in total) plus the $2,000 of associated earnings.

 

This is an overly simplified example as it only uses non-concessional contributions, but hopefully this helps clarify that while the associated earnings are included in your maximum release amount, they aren't included when working out the $15,000 and $30,000 limit on the contributions you can withdraw. 

 

LCR 2018/5 paragraph 21 also provides some more information on the eligible contribution limits.

 

In regards to leaving the contributions in the fund once you've contributed the maximum amount you can withdraw, there’s no time limit on how long you can keep the contributions you’ve made towards the FHSS scheme in your super fund. 

 

Generally speaking, the longer the contributions are in the super fund, the more associated earnings they will accrue. So when you choose to withdraw your FHSS amounts is up to you. You would just need to ensure you meet the FHSS scheme eligibility criteria when you request a determination and withdraw the amounts.

 

Thanks, NicM.

 

2 REPLIES 2

Devotee

Replies 0

Hi Nathan2110

 

Yes, the $30,000 limit applies only to the eligible contributions that are counted towards the amount that's eligible to be released.

 

The associated earnings aren't included in this limit, and no upper limit applies to the amount of earnings that can be released.

 

I'm an ATO employee voluntarily providing my time here

Best answer

ATO Certified

Moderator

Replies 0

Hi @Nathan2110,

 

Thanks for your question.

 

When you request a First home super saver (FHSS) scheme determination, we'll work out the maximum FHSS amount you can withdraw from your super. This is called the maximum release amount.

 

The maximum release amount is the sum of your eligible FHSS scheme contributions and the associated earnings on these contributions. The maximum release amount includes:

  • 100% of your eligible non-concessional contributions
  • 85% of your eligible concessional contributions, and
  • the associated earnings on both your eligible concessional and non-concessional contributions.

There is also a limit on how much of your eligible FHSS contributions you can withdraw from your super fund, with a limit of $15,000 of eligible contributions from any one financial year, and a limit of $30,000 of eligible contributions in total. 

 

As @SebReiter mentioned, associated earnings don’t count towards the $30,000 limit. We calculate the associated earnings using a specified rate when you request a determination. This means the amount we calculate may be different from the amount your contributions earned while they've been in your super fund.

 

As an example, let's say you contribute the following personal (non-concessional) contributions to your super fund for the FHSS scheme:

  • $20,000 in the 2017/2018 financial year, and
  • $20,000 in the 2018/2019 financial year.

In the 2019/2020 financial year, you request a determination and we calculate the associated earnings as $2,000.

 

In this example, your maximum release amount would be $32,000. The maximum release amount would be made up of $15,000 of eligible contributions from each financial year ($30,000 in total) plus the $2,000 of associated earnings.

 

This is an overly simplified example as it only uses non-concessional contributions, but hopefully this helps clarify that while the associated earnings are included in your maximum release amount, they aren't included when working out the $15,000 and $30,000 limit on the contributions you can withdraw. 

 

LCR 2018/5 paragraph 21 also provides some more information on the eligible contribution limits.

 

In regards to leaving the contributions in the fund once you've contributed the maximum amount you can withdraw, there’s no time limit on how long you can keep the contributions you’ve made towards the FHSS scheme in your super fund. 

 

Generally speaking, the longer the contributions are in the super fund, the more associated earnings they will accrue. So when you choose to withdraw your FHSS amounts is up to you. You would just need to ensure you meet the FHSS scheme eligibility criteria when you request a determination and withdraw the amounts.

 

Thanks, NicM.

 

Top Solution Authors