Downsizer contributions

Date of article: 2 May 2018
Last updated: 14 November 2018

From 1 July 2018, individuals aged 65 and over will be able to make superannuation contribution up to $300,000 from the proceeds of selling their main residence.

These contributions will not count towards the concessional or non-concessional contribution caps and the individual making the contribution will not need to meet the existing age, work or $1.6m total superannuation balance tests for contributing to super.

The dwelling disposed must have been owned continuously for the past ten or more years, and have been the main residence. Both members of a couple can contribute to super from the proceeds of the disposal.

Note that there is no requirement to purchase another dwelling.

Criteria for a downsizer contribution

• The contribution is made when you are aged 65 years and over (no maximum age limit), and
• The contribution is an amount equal to all or part of the capital proceeds received from the disposal of your or your spouse’s main residence, up to a maximum of $300,000, and
• The dwelling disposed must have been owned continuously for the past 10 or more years by you or your spouse (including your former spouse), and
• The contribution is made within 90 days after the time the change of ownership occurs as a result of the disposal (usually the date of settlement). Multiple downsizer contribution can be made from the proceeds of a single sale, up to the maximum amount, and
• You elect for the contribution to be a downsizer contribution in the appropriate form, and provide that form to the super fund either before or at the time of making the downsizer contribution.
• The rules applies to property located in Australia, and do not apply to caravan, houseboat or other mobile home.
• The downsizer contribution applies to the sale of your main residence where the exchange of contracts for the sale occurs on or after 1 July 2018.

You must complete ATO form NAT 75073 Downsizer contribution into superannuation form (signed and dated) before or when your superannuation fund receives the contribution.

Do you need help with your situation or if you wish to discuss the above, please contact us. Our contact details.