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downsizing

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Newbie

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Hello,

my Q. is about Downsizing.

Can I sell my home prior to age 65, provided that I contribute the money to my Super Fund when I turn 65 and within 90 days of settlement?

If correct here,  I can sell 90 days prior to turning 65, and contribute on my 65th birthday. Not real smart but just want to be clear on the rules.

 

Thanks, Peter

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ATO Certified Response

Anonymous

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Hi @carrick603 

 

As you may be aware, you can make a downsizer contribution into super if you meet all of the Eligibility criteria.

 

In your presented senario it does not make any difference when the house is sold, so long as you make the downsizer contribution into super within 90 days (or such longer time as the Commissioner allows) of receiving the funds, which is usually the settlement date and if it so happens that your 65th birthday falls on the 90th day you still qualify. 

Just remember the settlement period for a property is usually agreed to by all parties when they enter into the contract of sale, and the downsizer legislation does not specify what that settlement period should be.  This means you can make the settlement period for as long as you want so long as all parties to the contract agree.

 

Also, the ATO upon request may allow a period longer than 90 days in which to make the contribution. Refer to ATO Law Companion Ruling  LCR 2018/9  paragraph 81 and Paragraph 292-102(1)(g) of the Income Tax Assessment Act 1997.

 

This means that you can apply to the ATO for an extension of time in which to make a downsizer contribution. You would of course need to have sufficient grounds to satisfy the ATO that an extension is warranted, such as circumstances outside of your control and that would include but not limted to ill health, death in the family and moving house.

 

If you do apply for an extension of time and you disagree with the decision that is made, then you have the right to lodge an objection against that decision.   

 

If you need further assistance you can contact the ATO super team on SuperAdvice@ato.gov.au or for general super information phone 13 10 20   8.00am and 6.00pm - local time - Monday to Friday, except public holidays.

 

 

 

 

 

1 REPLY 1

Most helpful response

ATO Certified Response

Anonymous

Replies 0

Hi @carrick603 

 

As you may be aware, you can make a downsizer contribution into super if you meet all of the Eligibility criteria.

 

In your presented senario it does not make any difference when the house is sold, so long as you make the downsizer contribution into super within 90 days (or such longer time as the Commissioner allows) of receiving the funds, which is usually the settlement date and if it so happens that your 65th birthday falls on the 90th day you still qualify. 

Just remember the settlement period for a property is usually agreed to by all parties when they enter into the contract of sale, and the downsizer legislation does not specify what that settlement period should be.  This means you can make the settlement period for as long as you want so long as all parties to the contract agree.

 

Also, the ATO upon request may allow a period longer than 90 days in which to make the contribution. Refer to ATO Law Companion Ruling  LCR 2018/9  paragraph 81 and Paragraph 292-102(1)(g) of the Income Tax Assessment Act 1997.

 

This means that you can apply to the ATO for an extension of time in which to make a downsizer contribution. You would of course need to have sufficient grounds to satisfy the ATO that an extension is warranted, such as circumstances outside of your control and that would include but not limted to ill health, death in the family and moving house.

 

If you do apply for an extension of time and you disagree with the decision that is made, then you have the right to lodge an objection against that decision.   

 

If you need further assistance you can contact the ATO super team on SuperAdvice@ato.gov.au or for general super information phone 13 10 20   8.00am and 6.00pm - local time - Monday to Friday, except public holidays.