If you’ve been trying to save a deposit to purchase your first
home, you know how long it can take to hit the all important finance requirements
that are mandatory by many lenders. The Turnbull Government has given first
home buyers a lifeline to use their superannuation fund to save for a house
deposit through the First Home Super Saver Scheme.

The Scheme was passed through
Parliament in early December and for first home buyers this means that they can
stash cash using their super accounts while reaping significant tax benefits.
The Turnbull Government said the Scheme would help make owning a home become a
reality for many first home buyers who are squeezed out of the market.

It allows individuals to contribute
up to $15,000 each financial year to their super above their compulsory
contributions to a maximum of $30,000 and for couples they can contribute a
combined $60,000 in total. These contributions, which are taxed at 15%,
along with deemed earnings, can be withdrawn for a deposit.

Many employees will be able to take
advantage of salary sacrifice arrangements to make pre-tax contributions to
their superannuation fund. Individuals who are self-employed or whose employers
do not offer salary sacrifice can claim a tax deduction on personal
contributions, meaning savings effectively come out of their pre-tax income.

Since
July 1st 2018, first home buyers can make withdrawals of the extra savings that
they have tucked away in their superannuation accounts and use this to purchase
property and finally enter the real estate market. The Government has estimated
that most first home buyers would be able to grow their current savings by at
least 30% using the First Home Super Saver Scheme.

The
government has set up an online estimator so you can see how much you can save
using pre-tax contributions to your superannuation account compared to after
tax savings in a standard deposit account. Visit the Government budget estimator for more information or
contact us today using the form below.