Save for your first home using super
The First Home Super Saver Scheme (FHSSS) is an initiative to allow you to save money in your super account to go towards your first home deposit.
Overview of the scheme:
- ●You can voluntarily contribute up to $50,000 to your super account (up to $15,000 per financial year) to go towards a deposit for your first home.
- ●When you are ready to purchase your home, you can withdraw up to $50,000 in contributions plus associated earnings, less any taxes.
Eligibility for the scheme can be found on the ATO website.
The benefits of saving for a home inside super
Super gets a special tax treatment. You generally only pay 15% tax on the earnings within super.
This is compared to when you save the same amount of money in a savings account. You will be required to pay tax on the interest earned, and this is taxed at your personal income tax rate (which increases as your salary increases, and can be up to 47%).
How to start saving
To begin the FHSSS, you will need to make additional contributions to your super.
These must be voluntary contributions which can be added by making personal contributions or by salary sacrificing. You cannot access employer contributions through this scheme.
There are two methods to start:
1. Personal contributions - transfer from your bank account
This is the easiest method and allows you to stay in control of how much and when you contribute.
If you are a mobiSuper member, log in and make sure you have added your Tax File Number to your account.
You may also be able to claim a tax deduction for these personal contributions – see the ATO website for more information.
2. Salary sacrifice contributions - set this up with your employer
Speak to your employer or HR manager about setting up salary sacrifice contributions. You can normally do this if the total of your employer’s contributions, plus your salary sacrifice contributions is less than $27,500 p.a. (FY 2023-24).
These contributions are made from your before tax salary, so the contributions won’t incur income tax and are instead taxed at a concessional rate of 15%.
How do I access my savings?
When you are ready, you can apply to the ATO to request a determination. You do this using your myGov account if you’ve linked it with the ATO.
The determination will tell you the maximum amount you’re able to access under the FHSSS.
Once you’ve received the determination you can then apply to have your super released.
It’s important to consider the time it takes to receive the determination, the conditions of the scheme and the time it could take to receive your money. Read more on the ATO website.
If you have any questions about the determination and release of funds, it is best to contact the ATO as they handle this process.