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Hi just a mother quick question following up from your answer to my previous one.
You mentioned you can't use the super saver, well it would not be worth it if it was taxed.

in a case of apply for the release and getting a figure, then signing a contract during the process of release of funds.. i read it's 20%.

Does that mean if you were to receive $10,000 release but signed a contract between applying and the funds actually being released. The total tax of 20% would be $2000? I don't quite understand how it would not be worth it ?
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Hi @Michael3,

 

Thanks for your post.

 

If you sign a contract to buy or build a residential property before your FHSS amounts are released to you, then you'll be liable to pay the FHSS tax.

 

The FHSS tax is a flat rate of 20% and is in addition to any PAYG withholding tax that was withheld from your released FHSS amounts.

 

The FHSS tax is applied to the assessable FHSS released amount. The assessable FHSS released amount is the concessional contributions and associated earnings on both the concessional and non-concessional contributions.

 

For example, if your assessable FHSS released amount is $10,000 and you sign a contract to buy or build a property before we release your FHSS amounts, you'll need to pay the FHSS tax of $2,000 (20% of $10,000).

 

If you need to pay the FHSS tax, we'll send you a notice of assessment explaining how much tax you need to pay.

 

The FHSS scheme is just another way for first home buyers to save towards a deposit but it may not suit everyone’s needs. If you’re unsure whether the FHSS scheme is for you, you may want to seek independent financial advice.

 

Thanks, NicM

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Best answer

ATO Certified

Moderator

Replies 0

Hi @Michael3,

 

Thanks for your post.

 

If you sign a contract to buy or build a residential property before your FHSS amounts are released to you, then you'll be liable to pay the FHSS tax.

 

The FHSS tax is a flat rate of 20% and is in addition to any PAYG withholding tax that was withheld from your released FHSS amounts.

 

The FHSS tax is applied to the assessable FHSS released amount. The assessable FHSS released amount is the concessional contributions and associated earnings on both the concessional and non-concessional contributions.

 

For example, if your assessable FHSS released amount is $10,000 and you sign a contract to buy or build a property before we release your FHSS amounts, you'll need to pay the FHSS tax of $2,000 (20% of $10,000).

 

If you need to pay the FHSS tax, we'll send you a notice of assessment explaining how much tax you need to pay.

 

The FHSS scheme is just another way for first home buyers to save towards a deposit but it may not suit everyone’s needs. If you’re unsure whether the FHSS scheme is for you, you may want to seek independent financial advice.

 

Thanks, NicM

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