Since 1 July 2018, the ‘Contributing the proceeds of downsizing into superannuation” reform came into effect. In essence, it means if you have sold or are selling your home after that date AND meet the eligibility requirements, you may be able to contribute up to $300,000 into your superannuation fund from the proceeds of the sale.
The ATO has now released guidelines on the eligibility to make this type of superannuation contribution.
Could you be eligible for making a downsizer super contribution?
To meet the eligibility requirements, you must:
- Be 65 years or older
- Have exchanged the sale of property contract on or after 1 July 2018
- Be selling an eligible Australian dwelling that you (or your spouse) have owned for at least 10 years which qualifies for a full or partial capital gains tax exemption as your main residence
- Submit the approved form to note that this is a downsizer contribution either before or at the time of making the contribution
- Make the contribution within 90 days of receiving the funds from the sale
- Not made a downsizer contribution in the past
It’s important to note that downsizer contributions are not tax deductible. They will also be considered when determining your eligibility for the age pension.
If you are considering downsizing your home or have recently done so, contact us for more specific advice based on your situation.
For straight-forward, practical accounting, taxation and financial advice
contact our knowledgeable team at SVA and WPA by calling 02 8850 0388