First Home Super Saver Scheme

Help to buy your first home

The First Home Super Saver Scheme (FHSS) was introduced to reduce the pressure on affordable housing.  Access to this scheme applies from 1 July 2018.

From 1 July 2017 concessional and non-concessional contributions you make to your super fund can be applied to be released to help you purchase your first home.  Release requests can only be made after 1 July 2018.

Concessional/before tax contributions include salary sacrifice amounts, contributions by your employer and any other contribution you have claimed a tax deduction for.  Non concessional/after tax contributions are contributions you voluntarily make from your after tax dollars.

To be eligible:

  • applicants must be over 18 years of age
  • you must not have owned any property in Australia previously
  • you must not have used the FHSS already
  • intend to live in the property you wish to purchase as soon as practical after purchase
  • intend to live in the property for at least 6 months in the first year of owning the property

And no, don’t think about using the release funds to purchase a house boat, a motor home, vacant land or any other type of premises not capable of being occupied as a residence.

How much can you release from your super?

Eligible individuals can apply to release 100% of non concessional contributions and up to 85% of concessional contributions but are limited to a maximum of up to $15,000 in one financial year.  The maximum that can be released is $30,000 in total across more than one financial year.

Will there be tax?

Of course there will be tax!  The ATO will work out the tax to withhold from your released funds at your estimated marginal tax rate less a 30% tax offset or at 17% tax.

And yes, the released funds are also included in your taxable income in the year you request the release.  But the amount won’t affect any family tax benefit calculations for that same year.

If your request to release the funds is granted, there is a 12 month time limit to sign a purchase or construction contract.  Although it is possible to request an extension, if not granted, you can be requested to recontribute the release amount back to your super fund or pay further tax on the release amounts.

Please note the above is factual information only.  If you would like advice concerning the FHSS and your personal situation please contact us.  One of our authorised representatives would love to help you out.

Contact Us

SMSF Events Based Reporting

You may have heard of Events Based Reporting but not quite sure what this means for you as a member of a SMSF.

The ATO’s initial proposal of Events Based Reporting had software providers, administrators and professional bodies scratching their heads at the thought of the additional administration and costs required to adhere to the ATO’s new requirements.

There have been many disgruntled conversations over the last few months regarding the impracticality of these new reporting rules from these parties.

The superannuation changes from 1 July 2017 certainly had us on our toes and as if these changes weren’t enough, the ATO started to talk about ‘events based reporting’ as a means to keep track of individual’s superannuation balances.

We have now heard good news that the ATO has taken on board the many suggestions and criticisms its proposals received and eased up on the reporting requirements they wished to implement.

When will Events Based Reporting commence?

The ATO announced that its implementation of SMSF event based reporting will commence from 1 July 2018.

SMSFs with member balances over $1 million:

Events Based Reporting will be limited to those SMSFs with members with total superannuation account balances of $1 million or more.  These SMSFs will be required to report Transfer Balance Cap events 28 days after the end of the quarter in which the event occurred.

SMSFs with member balances under $1 million:

SMSFs whose members’ total superannuation balances are less than $1 million can report Transfer Balance Cap events at the same time the SMSF lodges it’s tax return.

 

The ATO originally expected all SMSFs regardless of account balances to report Transfer Balance Cap events monthly!

The final proposal will save SMSF’s excessive administrative costs.

SMSFs solely in accumulation phase are not affected by Events Based Reporting as it only relates to transfer balance cap events.

If you are one of our valued clients likely to be affected by the above reporting changes, you will hear from us closer to 1 July 2018 to help you transition to the new reporting rules.

 

If you would like to know more information please Contact Us

It’s SUPER time!

For businesses with employees, it’s quarterly Superannuation payment time!

The deadline for superannuation payment for the September 2017 quarter is due 28 Oct 2017. For businesses using AutoSuper on Xero, the cut off date to have it submitted and approved is 4pm AEDT, Tuesday 24 October. This ensures they reach the super funds by 28 October.

If you require assistance, Aston is happy to help!

Contact us!

Downsizing into Superannuation

The Government has released a Fact Sheet on their plan to encourage older people to downsize from homes that no longer meet their needs and to free up housing stock for young families starting out.

From 1 July 2018, older Australians will be provided with greater flexibility to contribute the proceeds of the sale of their home into superannuation, reducing a current disincentive to downsizing.

Read the Fact Sheet Here.

Recent changes affecting super contributions

From 1 July 2017, the following key changes to the contribution rules now apply:

Read More