What are the benefits of downsizer contributions?
1. Top up your super tax-free
Downsizer contributions may provide a timely opportunity for a tax-free top up of your super savings to provide extra income in your later years. No tax is paid when deposited into your super account, and you can also withdraw it tax-free later on.
2. Standard contribution caps don't apply
Downsizer contributions don't count towards your concessional or non-concessional contribution caps. However, they are limited by what you make on the sale of your home and are subject to a cap of $300,000 per person. Downsizer contributions can be made regardless of how much money you already have inside super.
3. There is no work test or age limits
No work test or upper age limits apply. This is particularly helpful if you’re aged 75 or over, because outside of downsizer contributions, you’re unable to make other voluntary contributions at this age.
4. You don't have to buy a new home
If you sell your home and choose to make a downsizer contribution, there’s no requirement for you to purchase another home with the proceeds from the sale.
5. Both members of a couple can contribute
Both members of a couple can take advantage, which means up to $600,000 of the sale proceeds (maximum $300,000 per person) can be contributed into super.