Using super to buy a home

Eligible first home buyers can use their super account to help save for a house deposit.

How it works

The First Home Super Saver Scheme (FHSSS) allows eligible first home buyers to withdraw their eligible voluntary super contributions – along with deemed earnings – to put towards a house deposit.

You can withdraw eligible voluntary contributions under the Scheme once only, and you can’t withdraw the super that your employer is obliged to pay or any spouse contributions – only the extra voluntary contributions you’ve made from 1 July 2017.

You can apply to have a maximum of $15,000 of your voluntary contributions from any one financial year included in your eligible contributions to be released under the FHSS scheme, up to a total of $30,000 contributions across all years. You will also receive an amount of deemed earnings that relate to those contributions.

The Scheme is administered by the Australian Taxation Office (ATO) but you pay your contributions into your TelstraSuper account. 

For many people, saving for a first home through super may help to grow the deposit more quickly.

Note: in the 2021/22 Federal Budget the Government announced its intention to lift the amount of extra voluntary contributions eligible participants can withdraw from $30,000 to $50,000, with an expected start date of 1 July 2022. It's important to understand that this is currently just a proposal and legislation would need to be passed for this change to take effect. We'll keep members updated via this page.

Eligibility

To be eligible to withdraw contributions under the FHSSS, you must:

  • be 18 years or older;
  • have not previously held interest in property (subject to certain exceptions);
  • have not previously accessed the Scheme.

To see a full list of eligibility criteria, visit the ATO website.

How to save for your home deposit in super

You can start saving by telling your employer that you’d like to start making voluntary contributions from your pre-tax salary.  You can also make voluntary post-tax super contributions into your super. Please note, the annual contribution caps still apply. 

How to contribute

  1. Pre-tax (concessional) contributions - you can contribute by cheque or BPAY and completing this form, or via salary sacrifice by speaking to your payroll department.
  2. Post-tax (non-concessional) contributions – you can make regular or one-off contributions via BPAY or by sending a cheque with this form.

Finding out how much you can withdraw

You can check your balance with TelstraSuper at any time to see how much you have saved. 

When you are ready to receive your FHSS amounts, you need to apply for an FHSS determination and a release from the ATO. When you apply for an FHSS determination they will tell you your maximum FHSS release amount.

Tax on FHSS release amount

  • Part or all of the FHSS released amount may be included in your assessable income.
  • The ATO will withhold tax from the FHSS release amount before paying it to you.
  • The ATO will provide a payment summary detailing the assessable FHSS released amount.
  • You need to include the assessable FHSS released amount in your tax return for the financial year in which you requested the release.
  • The tax liability on this assessable amount will be reduced by a 30% tax offset.
  • The withheld tax will help meet your tax liability for the year.

Using your deposit

Once your savings have been released, you have up to 12 months from the date you requested the release of FHSS amounts to sign a contract to purchase or construct a home. You can only make one withdrawal of your eligible contributions in your lifetime up to the maximum withdrawal amount of $30,000.

If you don’t buy a home in this period you may be able to extend for a further 12 months. 

If you do not enter into a contract to purchase or construct a home during this period, you can either:

  • recontribute the amount into your super fund. This amount must be a non-concessional contribution and be at least equal to your assessable FHSS released amount, less any tax withheld, or
  • you can keep the released amount and be subject to FHSS tax. This is a flat tax equal to 20% of your assessable FHSS released amounts.

Notifying the ATO

If you sign a contract to purchase or construct your home you must notify the ATO within 28 days of signing the contract.

If you recontribute the assessable FHSS amount (less tax withheld) into your super fund, you must notify the ATO within 12 months of the date you request the release of your FHSS money.

If you don't notify the ATO that you have done one of the above or you choose to keep the FHSS amount, you may be subject to the FHSS tax.

What should you do?

If you’re thinking of making a contribution, you may like to talk to TelstraSuper Financial Planning on 1300 033 166 for simple advice over the phone that’s provided at no additional cost as part of your TelstraSuper membership.

You can also read more about the scheme on the ATO website

Any general advice on this website has been prepared without taking into account your objectives, financial situation or needs. Before you act on any general advice on this website, you should consider whether it is appropriate to your individual circumstances. Before making any investment decision, you should obtain and read the relevant product disclosure statement which is available on the Website or by calling 1300 033 166 between 8.30 am and 5.30 pm (AEST) Monday to Friday. You may wish to consult an Adviser before you make any decisions relating to your financial affairs. To speak with an Adviser from TelstraSuper Financial Planning call 1300 033 166.