Many doubted its safe passage through the senate, but the government’s First Home Super Saver Scheme will be introduced from July 1 next year, allowing first home buyers to draw from their super to put a deposit on ‘the Aussie dream’
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Member for Cowper, Luke Hartsuyker, welcomed the recent passage of housing affordability legislation through the Parliament.
But not everyone felt the same.
Mr Hartsuyker said the scheme would help people across the Mid North Coast purchase their first home.
“The FHSSS is giving first home buyers a leg up by allowing them to save for deposit through their superannuation,” Mr Hartsuyker said.
“With housing prices at an all-time high, one of the greatest barriers to entering the market for first home buyers is saving the deposit. The FHSSS will provide a much needed tax cut to help first home buyers save their deposit.”
Through the FHSSS, individuals can make contributions of up to $15,000 per year, to an aggregate cap of $30,000, to their superannuation account to buy their first home. These contributions, along with deemed earnings, can be withdrawn for a deposit with withdrawals taxed at a marginal tax rate minus a 30 percent offset.
But Independent senator, Cory Bernardi thought the bill was bad policy dressed up as a tax cut.
David Leyonhjelm, made it clear that he had no trust in the legislation to help in the long run.
Allowing superannuation to be used for housing is unlikely to solve the housing affordability problem, it will just push prices up.
- Senator Leyonhjelm
Labor and the Greens have vehemently opposed the proposal, arguing it would increase prices and add existing pressure in the housing market while failing to remove negative gearing and capital gains tax concessions.
Mr Hartsuyker said the government was also committed to freeing up housing stock of larger homes for growing families.
“From July 1, 2018, people aged over 65 will be able to make a non-concessional contribution of up to $300,000 into superannuation from the sale of the family home, held for at least 10 years,” Mr Hartsuyker said.
“What this means is that, under this measure, a couple can make a contribution of up to $600,000 from the sale of their family home.
“This change will give older Australians greater flexibility to contribute the proceeds of the sale of their home into superannuation. If the family home no longer meets their needs, the Coalition Government is making things simpler for older Australians to downsize.”
More information on the HFSSS can be found online at www.ato.gov.au/General/New-legislation/In-detail/Super/First-home-super-saving-scheme/.