Since 1 July 2018 individuals over the age of 65 have had the ability to sell their family home and use some of the proceeds to contribute funds to superannuation. The measure allows ‘asset rich, cash poor’ retirees to release capital from their family home and have the opportunity to contribute up to $300,000 per individual (maximum $600,000 for a couple) into the tax-effective superannuation environment, where the funds can be used to support a tax-free income stream.
To be able to access this measure the individual needs to be over age 65, although there is currently legislation before parliament to reduce this to age 60, and the property must have been held for at least 10 years prior to the sale and must have been your primary residence for a period during ownership. The super contribution must be made within 90 days from the date of settlement.
The criteria and timing required in relation to these contributions is very important to get right, so if you are considering selling your home and making a downsizer contribution, please don’t hesitate to contact our office to speak with one of our financial advisers.