Updates on the First Home Super Saver Scheme for 2024
The First Home Super Saver Scheme (FHSSS) has been a key initiative to help first-time homebuyers
save for a deposit by using their superannuation. The 2024 updates to the scheme introduce
changes that prospective homebuyers need to understand to make the most of this opportunity.
This blog will guide you through the latest updates and how they impact you.
1. Increase in Maximum Withdrawable Amount
One of the significant changes to the FHSSS in 2024 is the increase in the maximum amount that can
be withdrawn from superannuation. The cap has been raised from $50,000 to $60,000. This change
allows first-time buyers to access more of their superannuation savings to contribute to their home
deposit.
The increased cap means that individuals can contribute more voluntarily to their superannuation
with the intention of later withdrawing these amounts, along with associated earnings, to purchase
their first home.
2. Extended Eligibility Criteria
The eligibility criteria for the FHSSS have also been expanded. Previously, the scheme was only
available to those who had never owned property in Australia. The 2024 updates have relaxed this
criterion slightly, allowing individuals who have not owned property for at least 10 years to qualify as
first-time homebuyers under the scheme.
This change opens the door for more individuals who may have owned property in the past but have
since been out of the property market, enabling them to re-enter using the FHSSS.
3. Changes to Contribution Rules
The rules around making voluntary contributions under the FHSSS have also been updated.
Individuals can now contribute up to $15,000 per financial year, up from the previous limit of
$10,000. This higher limit allows participants to accumulate the maximum withdrawable amount
more quickly.
It’s important to note that these contributions must be voluntary concessional (before-tax) or non-
concessional (after-tax) contributions. The ATO will calculate the amount that can be released based
on these contributions and associated earnings.
4. Simplified Withdrawal Process
The withdrawal process under the FHSSS has been simplified in 2024 to make it easier for
participants to access their savings. The updated process reduces the administrative burden and
speeds up the release of funds, helping first-time buyers access their money when they need it.
Applicants can now submit a request to the ATO for a determination of their eligible FHSSS amount,
followed by a request for release once they are ready to purchase a property. The ATO has
streamlined these steps to ensure quicker processing times.
5. Tax Considerations
It’s essential to be aware of the tax implications when withdrawing funds under the FHSSS. While
the scheme allows for the release of voluntary contributions and associated earnings, these amounts are subject to taxation. The released funds will be taxed at your marginal tax rate, less a 30% tax offset.
Understanding the tax implications is crucial for budgeting your home deposit and ensuring that the
net amount after tax meets your needs.
Conclusion
The 2024 updates to the First Home Super Saver Scheme provide greater flexibility and higher
savings potential for first-time homebuyers. Whether you’re just starting to save or are ready to
purchase your first home, understanding these changes can help you maximize the benefits of the
scheme.
If you need assistance with making contributions under the FHSSS or understanding how the scheme
fits into your broader financial plan, our team of superannuation and tax experts is here to help.
Contact us today to get started on your journey to home ownership.
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