First Home Super Saver Scheme
The Government announced a scheme that will allow first home buyers to use superannuation as a means of saving to buy their first home. They will be allowed to salary sacrifice superannuation contributions up to $15,000 per year and $30,000 in total can be contributed within existing concessional contribution limits of $25,000 per annum.
Voluntary contributions to superannuation made by first home buyers from 1 July, 2017 will be able to be withdrawn from 1 July, 2018 for a deposit on a first home, along with associated deemed earnings. Currently, withdrawals usually cannot be made from a superannuation fund until a person has reached 55 to 60 years of age, depending on their date of birth. These concessional contributions and the associated earnings (calculated on the 90 day Bank Bill rate plus 3%) can subsequently be withdrawn from the superannuation member’s account. On withdrawal, these funds will be taxed at marginal tax rates less a 30% tax offset.
In most circumstances, the net tax paid on contributions and earnings under the scheme would be 15% and the overall net tax benefit achieved for a first home buyer who contributes and withdraws the full $30,000 and who has a marginal tax rate of 39% (including Medicare levy) will be $4,500.
Members of a couple will each have access to the scheme (taking this to potentially $60,000 in total). Self-employed individuals and employees who are not able to access salary sacrifice will be able to claim a tax deduction on personal contributions.
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Other Articles in This Edition:
Some of the Biggest Mistakes Small Businesses Make With Their Websites
Federal Budget – Economic Summary
Small Business - $20k Small Business Immediate Tax Deduction
Small Business - Company Tax Rates
Small Business - Extension of Taxable Payments Reporting to Courier and Cleaning Industries
Small Business - Access to CGT Concessions
Small Business - Looking to Employ Foreign Workers?
Individual Tax Rates
Individuals - Changes to the Medicare levy
Restricting Residential Investment Property Deductions
Individuals - Higher Education Reform
Superannuation - Contributing Proceeds from Downsizing to Superannuation
GST Changes - Purchasers to Pay GST on New Residential Premises
GST Changes - Digital Currency & Low-Value Imports
Tax Integrity Measures
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