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First Home Super Saver Scheme

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Hello

 

In regards to Widrawing FHSSS Contributions i have a few questions.

1: Do the funds have to be released in order to sign a contract to purchase or can the funds be in the process fo being released?

2: Do the investment returns stop once you request for the funds to be released? e.g if i request the funds to be released today and do not use them for 11months is that money sitting there not getting any returns?

3: where do the funds get released too?

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Devotee

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Hi Grayson

 

1 - to not pay the additional FHSS tax you need to sign a contract within 12 months of the money being released. That means within 12 months of the date the ATO initiates the payment to your bank account, NOT the date that you've applied for a release, or the date that your super fund has sent the money to the ATO.

 

2 - it depends on where you sit the money until you use it to buy a house. Once the money has been released from your super account it won't be accruing any further returns in the super fund. If you park it in a term deposit you'll get whatever rate of return is attached to that. It's possible that the returns are better in the super fund and it may make sense to leave the money with the fund until you're ready to buy a house.

 

3 - the ATO will pay the released money to the bank account you advise you'd like the money to be paid into

 

I'm an ATO employee voluntarily providing my time here

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Best answer

Devotee

Replies 1

Hi Grayson

 

1 - to not pay the additional FHSS tax you need to sign a contract within 12 months of the money being released. That means within 12 months of the date the ATO initiates the payment to your bank account, NOT the date that you've applied for a release, or the date that your super fund has sent the money to the ATO.

 

2 - it depends on where you sit the money until you use it to buy a house. Once the money has been released from your super account it won't be accruing any further returns in the super fund. If you park it in a term deposit you'll get whatever rate of return is attached to that. It's possible that the returns are better in the super fund and it may make sense to leave the money with the fund until you're ready to buy a house.

 

3 - the ATO will pay the released money to the bank account you advise you'd like the money to be paid into

 

I'm an ATO employee voluntarily providing my time here

Initiate

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Hi @SebReiter

 

Thank you for the reply.

I am finding that the system how it currently is set up is not very user friendly.

What is the benefit of making the first home buyer have the funds in his/her bank account prior to the signing of a contract?

Buying a home is not a clear cut decision, it could take a buyer 10minutes or 10 years to sign a contract.

The current system forces the first home buyer to pull his/her money out of the scheme a minimum of 25days prior to them even starting to look for a home. Not to mention how long an employer can take to put contributions into your Super account. some employers only put funds in quarterly my superannuation fund informs me.

Does anyone know of a plan/talk to change this rule?

 

Thank you very much for providing your time to answer these questions it is appreciated.

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