Complex Superannuation Strategies

Downsizing Measure

Since 1 July 2018, home-owners have been able to use the proceeds from the sale of their home to make a non-tax-deductible contribution of up to $300,000 each (up to $600,000 per couple) into superannuation.  This is known as a downsizer contribution.  From 1 July 2023, the minimum age to be able to make a downsizer contribution has been reduced to age 55. This measure is aimed at providing retirees with greater flexibility around selling the family home and moving some of the proceeds into super in order to boost retirement savings.

Some of the finer details are:

  • No work test or age limits apply, however the person must be over age 55 from 1 July 2023.
  • The home (excluding houseboats, caravans and mobile homes) must have been owned by the person or their spouse for 10 years or more prior to disposing of it. In addition, all or part of any gain or loss from the sale must have qualified (or would have qualified) for the main residence capital gains tax (CGT) exemption. 
  • The contribution must be made within 90 days of the date of the disposal (e.g. date of settlement); however, an extension may be granted in certain circumstances.