Is it possible to use your superannuation to buy a house? YES!
The good news is that it is very much possible through the First Home Super Saver Scheme (FHSS)!
The First Home Super Saver (FHSS) scheme was introduced by the Australian Government to reduce pressure on housing affordability. The aim is to help first-home buyers save faster with the concessional tax treatment of superannuation.
Home buyers are eligible to make voluntary contributions towards their super and use it as a deposit. This scheme allows first-home buyers to save up to $30,000 of voluntary contributions overall. Spread across each financial year; you can save a maximum of $15,000.
If you are a first home buyer and considering using your superannuation to buy your first home, the below eligibility criteria apply:
- You either live in the premises you are buying or intend to as soon as it is practically possible
- You intend to live in the property for at least six months within the first 12 months you own it, after it is practical to move in.
You can apply to have a maximum of $15,000 of your voluntary contributions from any one financial year included in your eligible contributions to be released under the FHSS scheme, up to a total of $30,000 contributions across all years.
You can start making super contributions at any age. However, you must be 18 years old or older to request a determination or a release of amounts under the FHSS scheme.
There are a few other things that First Home Buyers need to consider in order to avail of the FHSS scheme:
- You must never have owned property in Australia. This includes investment property, vacant land, commercial property, a lease of land in Australia, or a company title interest in land in Australia (unless the Commissioner of Taxation determines that you have suffered a financial hardship).
- You also must not have previously requested the Commissioner to issue an FHSS release authority in relation to the scheme.
Eligibility is assessed on an individual basis. This means that couples, siblings or friends can each access their own eligible FHSS contributions to purchase the same property. If any of you have previously owned a home, it will not stop anyone else who is eligible from applying.
Some of the advantages of the FHSS for a First Home Buyer are:
- Save money on tax repayments
- Couples can combine their funds under this scheme
- The amount you can withdraw doesn’t vary with falling markets
- You will be given a 12-month buffer to purchase a home with the funds after you withdraw the money
Want to know more about purchasing your first home? Get in touch with us by calling (02) 9099 3412 or simply enquire below, and the team at St Trinity will be delighted to help.