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First Home Buyers Super Savers Scheme

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We're looking at buying our first home and saving a deposit. I've been looking into the First Hope Buyers Super Savers Scheme and are very confused. A couple of the big questions we have:

1. Is there a minimun amount of money or time we have to deposit into our super before we can withdraw it?

2. When i've used the estimated calculator the amount we can withdraw is always less than contributions made eg If we make $10,000 annual contributions for three years we can withdar around $27,000 (according to the estimator calculator). My question is, why would this be a better option than contributing $10000 a year into a high savings account? 

Im pretty lost on the tax we would pay (15%?) and how that compares to being taxed on savings or a deposit?

Looking forward to your answers!

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Anonymous

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Hi @NMierendorf

 

The Federal Government have tried to explain the FHSSS in a fact sheet https://www.budget.gov.au/2017-18/content/glossies/factsheets/html/HA_14.htm

 

Here are some interesting links:

https://www.superguide.com.au/accessing-superannuation/accessing-super-early/new-first-home-super-sa...

https://www.ato.gov.au/Individuals/Super/Super-housing-measures/First-Home-Super-Saver-Scheme/

 

Not sure what estimator you used but there is also one here.

  

ATO general tax line 13 28 61

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Best answer

Anonymous

Replies 0

Hi @NMierendorf

 

The Federal Government have tried to explain the FHSSS in a fact sheet https://www.budget.gov.au/2017-18/content/glossies/factsheets/html/HA_14.htm

 

Here are some interesting links:

https://www.superguide.com.au/accessing-superannuation/accessing-super-early/new-first-home-super-sa...

https://www.ato.gov.au/Individuals/Super/Super-housing-measures/First-Home-Super-Saver-Scheme/

 

Not sure what estimator you used but there is also one here.

  

ATO general tax line 13 28 61

Moderator

Replies 0

Hi @NMierendorf,

 

Thanks for posting.  

 

The contributions you make towards the FHSS scheme are not a new type of contribution, so all the existing rules and limits to contributing to super still apply.

 

There’s no minimum amount or time frame you need to contribute towards the FHSS scheme before you withdraw your money.  However, there is a limit on the amount you can withdraw, with a maximum of $15,000 of eligible contributions from any one financial year and a limit of $30,000 of your eligible contributions in total.


How much you can withdraw (your maximum release amount) depends on whether you have made concessional (before tax) or non-concessional (after tax) contributions to your super fund.  The maximum release amount is:

  • 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.  

If you only made $10,000 worth of concessional contributions (e.g. through a salary sacrifice arrangement) each year for three years, then your maximum release amount would be $25,500 (85% of $30,000) plus any associated earnings. 

 
The reason the concessional contributions are 85% is because contributions are taxed at 15% while they are invested in the fund (which is usually a lower rate than the marginal tax rate). 

 

Alternatively, if you made $10,000 worth of non-concessional contributions each year for three years, then your maximum release amount would be $30,000 plus any associated earnings.

 

The associated earnings on your eligible contributions are calculated by us using a specific rate and don't count towards the $30,000 limit.

 

The above examples are fairly simple, but hopefully this helps explain why the eligible contributions you withdraw may be different to the amount you actually contributed to your super fund. 

 

Regarding your question on how the 15% tax in the super fund differs from the tax on savings, if you save the money in a bank account and earn interest on that amount, then the interest would be included in your tax return and taxed at your marginal tax rate.

 

Ultimately, choosing to use the FHSS scheme is a financial decision you need to make based on whether it suits your needs.  If you are unsure if the FHSS scheme is right for you and your situation, you may want to seek independent financial advice.  

 

Thanks, NicM.

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