From 1 July 2018, if you are 65 years old or older and meet the eligibility requirements, you may be able to choose to make a downsizer contribution into your superannuation fund of up to $300,000 from the proceeds of selling your home.
The downsizer contribution is not a non-concessional contribution and will not count towards your contributions caps however it will count towards your transfer balance cap – moving money from your super savings into retirement phase - which is currently set at $1.6million.
Despite the name given to the contribution, there is no requirement to downsize when purchasing a subsequent property and no requirement to purchase another home.
A downsizer contribution can only be made if you meet all of the following conditions:
You are 65 years old or older at the time of the contribution;
The contract of sale was entered into on or after 1 July 2018;
The home was owned by you or your spouse for 10 years or more prior to the sale – the ownership period is generally calculated from the date of settlement of purchase to date of settlement of sale;
Your home is in Australia and is not a caravan, houseboat or other mobile home;
The contribution cannot exceed $300,000 per person;
Any capital gain or loss from the disposal of the home must have qualified (or would have qualified) for the main residence CGT exemption in whole or in part;
You have provided your super fund with the “Downsizer contribution into super” form either before or at the time of making the contribution;
The contribution has been made within 90 days of disposing of the home;
You have not previously made a downsizer contribution to your super from the sale of another home.
If your home that was sold was only owned by one spouse, the spouse that did not have ownership interest may also make a downsizer contribution, or have one made on their behalf, provided the meet all of the other requirements.