Other than needing to be 65 years of age or older, there are other requirements including having to make the downsizer contribution into your super fund within 90 days of receiving the funds from the sale. You also must have owned your home for 10 years or more before the sale takes place. And lastly, one of the main eligibility elements is that it must be a property. It can’t be a caravan, houseboat or mobile home.
You are able to make multiple contributions into your
[CCS1] super fund if they are all from a single sale of your family home. As long as the total of the contributions is $300,000 or less per person, and is not the total sale value of the home.
Unlocking the capital that your family home holds, and putting those funds directly into super could really give your superannuation fund a massive boost.
Contributions up to $300,000, or even $600,000 if you’re in a couple, have the potential to give you an annual $30,000 in tax free retirement income.
In addition, the downsizer contribution does not count towards your contribution caps.
This may all be sounding too good to be true – and that’s because there are some downsides. For example, in social security terms, a downsizer contribution can significantly reduce age pension payments, as superannuation is assessed as a financial asset. The value of a family home is otherwise exempt.
Your aged care plans are something that also needs to be considered when thinking about making any downsizer contribution to your superannuation fund. Having more money sitting in your super can affect how much you are required to pay yourself.
If you’re unsure, always chat to a professional to ensure you achieve the best financial outcome for your retirement.