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    First Home Super Saver (FHSS)

    Save your house deposit inside super at a lower tax rate

    What is First Home Super Saver (FHSS)?

    The First Home Super Saver Scheme (FHSS) allows first home buyers to make voluntary contributions to superannuation and then withdraw them (plus earnings) for a home deposit. Contributions are taxed at 15% inside super instead of your marginal rate, potentially saving thousands in tax.

    How it works

    1. 1Make voluntary concessional (pre-tax) or non-concessional (after-tax) contributions to your super
    2. 2Max $15,000/year and $50,000 total per person can be contributed under FHSS
    3. 3Concessional contributions taxed at 15% in super (vs your marginal rate of up to 47%)
    4. 4Apply to the ATO to release FHSS funds when ready to purchase
    5. 5ATO releases the amount plus an "associated earnings" figure (based on shortfall interest charge rate)
    6. 6Funds must be used within 12 months of release for a qualifying home purchase

    Worked example

    You earn $85,000 (30% bracket; 32% with the Medicare levy).
You salary sacrifice $15,000 a year into super under the FHSS for 3 years = $45,000.
Contributions are taxed at 15% in super instead of 32%: $15,000 × 17% = $2,550 a year, $7,650 over 3 years.
On release, the amount is taxed at your marginal rate less a 30% offset (2% here).
A couple can each release up to $50,000 ($100,000 together) plus associated earnings.

    Pros

    • Tax saving: contributions taxed at 15% inside super vs your marginal rate
    • Effective for couples, both can contribute up to $50,000 each ($100,000 combined)
    • Investment earnings inside super also taxed at just 15%
    • Reduces your taxable income in the years you contribute

    Cons

    • Funds are locked in super until you apply to the ATO, not liquid like a savings account
    • If you don't buy within 12 months of release, funds must be recontributed to super or taxed heavily
    • Doesn't work if you've previously owned property in Australia
    • Release amounts are subject to income tax (at marginal rate less a 30% tax offset) on withdrawal

    Risks

    • Super fund investment performance affects the amount you receive
    • Administrative risk: ATO release process can take weeks, plan ahead for settlement
    • Eligibility is strict: must be first home, must intend to live in the property
    • If deal falls through, strict reinvestment rules apply

    Tax treatment

    Concessional contributions: 15% tax in super. Non-concessional: already taxed, no further tax in super. On release: assessable at marginal rate less a 30% tax offset (effectively low rate). Associated earnings assessed at shortfall interest charge (SIC) rate. ATO reference: First Home Super Saver Scheme (FHSS), QC 52455.

    Official references

    Keep exploring

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    General Advice Warning

    The information on this site is general in nature and does not consider your personal circumstances, financial situation, or needs. Before acting on any information, you should consider its appropriateness having regard to your own situation and seek professional advice from a licensed financial adviser, mortgage broker, accountant, or solicitor.