First Home Super Saver Scheme Contribution Limits Australia

First Home Super Saver Scheme Contribution Limits Australia

First Home Super Saver Scheme Contribution Limits Australia

The First Home Super Saver Scheme (FHSSS) in Australia is a government initiative aimed at helping first-time home buyers save for their dream home through their superannuation funds. This scheme allows eligible individuals to make voluntary contributions into their super, which can later be withdrawn, along with associated earnings, to put towards purchasing or building their first home. One of the critical aspects of the FHSSS is understanding the contribution limits, which play a pivotal role in how much you can save and withdraw under this scheme.

The annual contribution cap under the FHSSS is currently set at $15,000, meaning individuals can contribute up to this amount in a financial year. Additionally, there is a total contribution limit of $30,000, which accumulates over the period of participation in the scheme. These limits are designed to ensure that individuals can save a substantial amount for their first home while also balancing their retirement savings goals.


To maximize contributions under the FHSSS, individuals can employ various strategies such as salary sacrifice, where they arrange with their employer to contribute a portion of their pre-tax salary into their super fund. Another strategy is contributing after-tax income and claiming a tax deduction for these contributions, which count towards the FHSSS limits. Understanding these strategies and contribution limits is essential for making the most of the FHSSS and accelerating your journey towards homeownership

When it comes to contributing to your super under the FHSSS, there are a few key limits to keep in mind.


1. Annual Contribution Cap

The annual contribution cap is the maximum amount you can contribute to your super in a financial year under the FHSSS. As of the current financial year, this cap is set at $15,000.

2. Total Contribution Limit

There’s also a total contribution limit over the course of your participation in the FHSSS. This limit is currently $30,000.


Strategies to Maximize Contributions

Utilizing Salary Sacrifice

One strategy to maximize your contributions is through salary sacrifice. This involves arranging with your employer to contribute a portion of your pre-tax salary into your super fund.

Contributing After-Tax Income

You can also contribute after-tax income to your super fund and claim a tax deduction for these contributions, which count towards your FHSSS limits.

Alex’s FHSSS Journey

Let’s bring this to life with an example. Meet Alex, a young professional looking to buy their first home. Alex decides to take advantage of the FHSSS. They contribute $10,000 through salary sacrifice and $5,000 from after-tax income, totaling $15,000 for the financial year.

What Happens Next?

1. Tax Benefits

Alex enjoys tax benefits on these contributions, making their savings grow faster compared to traditional savings methods.

2. Investment Earnings

The contributions earn investment returns within the super fund, further boosting Alex’s savings.

3. Withdrawal for First Home

When Alex is ready to buy their first home, they can apply to release their contributions (and earnings) from their super fund to put towards the purchase.

Frequently Asked Questions

1. Can I contribute more than the annual cap?

  • Yes, you can, but contributions above the cap won’t count towards the FHSSS.

2. What happens if I exceed the total contribution limit?

  • Excess contributions can be subject to additional tax.

3. Can I use the FHSSS for an investment property?

  • No, the scheme is specifically for first home buyers.

4. Is there an age limit for participating in the FHSSS?

  • Yes, you must be 18 years or older to participate.

5. How do I apply to withdraw my savings under the FHSSS?

  • You apply through the ATO (Australian Taxation Office) once you have a contract to buy or build your first home.

6. What if I change my mind and don’t buy a home?

  • You have 12 months from the release of funds to sign a contract for a property, or you can recontribute the funds to your super.

7. Can I contribute to my partner’s FHSSS?

  • No, each individual must have their own FHSSS account.

8. Are there any restrictions on the type of super fund I can use?

  • Your super fund must be a complying super fund or retirement savings account.

9. Do I need to pay tax when I withdraw my savings for a first home?

  • Generally, withdrawals are taxed at a concessional rate.

10. Can I use the FHSSS for renovations on my first home?

  • No, the funds can only be used for the purchase or construction of a first home.

The First Home Super Saver Scheme contribution limits in Australia are designed to encourage and facilitate saving for your first home. By understanding these limits and strategies to maximize contributions, like salary sacrifice and after-tax contributions, you can make the most of this initiative.

Always consult with financial professionals or the ATO for personalized advice regarding your specific circumstances. Happy home hunting!


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