Launching into SA’s property market

In short, the FHSS scheme lets you tap into the portion of your super that you personally contribute, to help cover the costs of a deposit on your new home.

If you’ve been contributing for a while, you may have enough already. If you’re not looking to buy for a few years, then now could be a good time to start and gain a tax concession.

When the time comes, you can withdraw up to $15,000 worth of contributions per year to a total of $50,000 plus the earnings while the funds were in your super.

Looking overall, South Australia’s First Home Owners Grant can help reduce the pain of buying your first home, but you still need to fund your deposit, which is where the FHSS scheme comes in.

You can save by making your own contributions to your super (over and above what your employer contributes for you).

A common method is salary sacrificing, where you ask your boss to pay an extra bit of your salary directly into your super, instead of to you each payday. It then gets taxed at only 15% instead of your higher, regular income tax rate.

Alternatively, you can also do it yourself, by transferring an amount and claiming a tax deduction with your return.

Note, there are caps on how much you can contribute each year.

1. Check you’re eligible for the FHSS – are you 18 years old or over and a first home buyer? There’s no Australian citizenship or residency requirement to apply.
2. Check that your super fund allows you to withdraw under the FHSS (Spaceship Super does!)
3. Start out by contributing to your own super in any of the following ways:
   1. Contribute after-tax money to your super and then a claim tax deduction in your tax return.
   2. Salary sacrifice, by asking your employer’s payroll department to send some of your income directly to your super account instead of to you.
   3. Contribute after-tax money to your super account, without claiming a tax deduction.
   • Options a and b count towards your ‘concessional contributions’ annual cap of $27,500 (including your employer contributions) and come with tax savings.
   • Option c counts towards your ‘non-concessional’ annual cap of $110,000.
   • There’s a $15,000 cap on how much you can save via the FHSS each year. 
4. Think financial years. Your annual limits reset on 1 July every year. 
5. When it comes time to start looking for a home, you apply for a FHSS Determination and a release from the ATO.
   Make sure you get the determination before you sign a contract, so you know how much you’re able to withdraw as a deposit.
   Much of the information will be pre-filled, but it will be handy to have a record of your contributions on hand just to check.
6. Buy your property!
   Once you sign a contract, submit an FHSS Release Request.
   The ATO requires this within 14 days of signing the contract, but it’s best to do it straight away.
   The amount you withdraw via FHSS will be paid into your bank account. In most cases it will take between 15 to 25 business days.
7. Alternatively, you can submit the Release Request before signing a contract.
   If you do this, you have up to 24 months (an initial 12 months and an automatic 12-month extension if you need it) to sign a contract on your first home.
   If more than one person is buying the home, each person can use their own FHSS as long as they meet the criteria.
   Even if one person is not eligible, other eligible buyers can still apply for the FHSS.

The First Home Guarantee (FHBG) is an Australian Government program designed to help eligible buyers purchase their first home with a deposit of as little as 5% instead of the 20% that many lenders require for a loan that doesn’t have Lenders Mortgage Insurance attached.

The Commonwealth Government’s First Home Guarantee (FHBG) is a way for eligible applicants to eliminate the expense of Lenders Mortgage Insurance, which can be as much as $10,000.

The FHBG is generally the only way to avoid this insurance in South Australia, unless you’re able to pay a higher deposit – often around 20%.

In general, to qualify for the First Home Guarantee (formerly First Home Loan Deposit Scheme or FHLDS) in South Australia in 2023, you must meet these conditions:

• Over 18 years of age
• Earn less than $125,000 as an individual, or $200,000 as a couple.
• Be an Australian citizen
• Live in the property
• Be buying your first home.

Only residential real estate qualifies, including:

• New or existing home, townhouse or apartment
• House + land packages
• Land plus a contract to build
• Off-the-plan property.

In Adelaide, the property must have a value of not more than $600,000 and in wider SA the maximum value is $450,000.

Visit the First Home Buyer Guarantee website for full eligibility details.

Join Spaceship Super - One super account is all you need to save using FHSS