The Parliament has today passed key elements of the Turnbull Government’s housing affordability plan, giving first home buyers a tax cut by allowing them to save for a deposit inside superannuation through the First Home Super Saver Scheme (FHSSS), and allowing older Australians to contribute the proceeds of the sale of their family home into superannuation.
Through the FHSSS, individuals can contribute up to $30,000 (up to $15,000 a year within existing caps) into superannuation. This means an eligible couple could contribute up to $60,000, supercharging their deposit savings. Most first home buyers will be able to accelerate their savings by at least 30 per cent using the Scheme.
The FHSSS provides a much-needed tax cut to young Australians saving for their first home. From 1 July 2018, first home buyers will be able to withdraw voluntary superannuation contributions they've made since 1 July 2017, along with a deemed rate of earnings, to help buy their home. This will give first home buyers a significant leg-up towards saving their deposit, helping them overcome a key barrier for getting into the housing market.
The downsizing measure removes a financial obstacle from older Australians who are considering moving to homes that better suit their needs.
From 1 July 2018, when Australians aged 65 and over sell a home they have owned for at least 10 years they may contribute up to $300,000 from the proceeds into their superannuation accounts, over and above existing contribution restrictions. Both members of a couple may take advantage of this measure, together contributing up to $600,000 from the proceeds of the sale into superannuation. This will encourage older Australians, where appropriate, to free up homes that no longer meet their needs for younger growing families.
The measures legislated today are part of the Turnbull Government’s comprehensive approach to housing affordability. The Turnbull Government is continuing to deliver on its commitment to ensure all Australians have access to secure, stable and affordable housing.
Labor stand condemned for their failure to support the Government’s tax cut for first home buyers. Labor’s absolute refusal to help first home buyers save for a deposit show they can’t be trusted on housing affordability.