As strict timeframes apply, you should contact us if you sell your home (or intend to sell your home) and are interested in contributing some of the proceeds to your superannuation fund.
Why are downsizer contributions attractive?
- They do not count towards your ordinary contribution limits;
- They can be made even if have more than $1.6 million in superannuation;
- They can be made even if you do not meet the work test; and
- They can be made at any age after age 65 (i.e. there is no maximum age limit).
Do I have to downsize my home?
No, there is not actual requirement to buy or move into a smaller home. In fact, you do not even have to buy a new home.
Will I be eligible?
If each of the following applies to you, you may be eligible to make a downsizer contribution of up to $300,000 to your superannuation fund:
- you are at least 65 years of age at the time you make the contribution;
- your home was owned by you (or your spouse) for at least 10 years prior to its sale;
- the contract of sale is dated on or after 1 July 2018;
- the downsizer contribution does not exceed the proceeds from the sale of your home.
Is there any timing and/or compliance requirements?
Yes, downsizer contributions must be made within 90 days of receiving the proceeds of sale (which ordinarily occurs on settlement).
A downsizer contribution form will also need to be provided to your super fund before (or at the time of) making the contribution.
Can my spouse and I both make downsizer contributions after selling our home?
Yes, provided the ordinary eligibility requirements are met, you will both be eligible to make a downsizer contribution of up to $300,000 in relation to the sale of your home. You would both be eligible even if only one of you was the legal owner.
However, the total downsizer contributions cannot exceed the proceeds from the sale. For example, if your proceeds were $500,000, your total downsizer contributions are similarly limited to $500,000.