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FHSS contributions/tax deduction in the same financial year as COVID-19 early release

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Hello,

 

During the 19 - 20 FY, I contributed 15k into my super under the FHSS scheme (about $5500 salary sacrifice and the remainder as a BPAY contribution that I claimed a tax deduction for in my 2020 tax return). I am in the process of contributing the second 15k and will complete this by the end of September (approximately the same - $5500 salary sacrifice, $9500 personal contribution). I will send the 'notice of intent to claim' form to my super fund at the end of September, as I intend to claim a tax deduction for the $9500 in my 2021 tax return. At this stage I am unsure when I will apply to release my FHSS amounts, but I may also apply to release this before 30 June 2021.

 

My hours have been reduced by 20% due to COVID-19, so I am also considering releasing some superannuation under the COVID-19 early release scheme later in the year. I am definitely eligible and have the reduction agreement in writing from my employer/evidence of reduced hours on my payslips. If I proceed with this, I will apply for the COVID-19 release after I have finished making FHSS contributions (and after I have received the acknowledgement letter of tax deduction from my super fund). 

 

I am aware that the withdrawals would be treated separately (ie COVID-19 release won't reduce the eligible amounts to be released under FHSS scheme at a later date). However, after reading about COVID-19 release 'integrity and compliance' I am wanting to be 100% sure that the above won't cause any tax issues (specifically as I would be claiming a tax deduction for a FHSS contribution and releasing COVID-19 funds during the same financial year). See this page:

 

https://www.ato.gov.au/Individuals/Super/In-detail/Withdrawing-and-using-your-super/COVID-19-Early-r...

 

I reiterate all FHSS contributions will be made/acknowledged by my super fund before I apply to release COVID-19 funds, so I will not be withdrawaing and then recontributing. But, if I do go ahead, the tax deduction and the COVID-19 withdrawal would occur in the same financial year.

 

There doesn't seem to be any reference to using both schemes together, so I'd really appreciate clarity that the above is permitted.

 

Thank you.

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Community Support

Replies 0

Hi cashmusic23,

 

Yes, you may be able to do this, under the set conditions as explained under each scheme. There is another ATO Community thread re: early release of super & FHSS here, which is very relevant to your question. Also, please consider the effect of claiming a tax deduction on contributions re: the First Home Super Scheme (there are some references to 'deduction' on this linked webpage eg under section, 'Eligible contributions').

1 REPLY 1

Most helpful response

Community Support

Replies 0

Hi cashmusic23,

 

Yes, you may be able to do this, under the set conditions as explained under each scheme. There is another ATO Community thread re: early release of super & FHSS here, which is very relevant to your question. Also, please consider the effect of claiming a tax deduction on contributions re: the First Home Super Scheme (there are some references to 'deduction' on this linked webpage eg under section, 'Eligible contributions').