‘Downsizer contributions’ to super

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If you’re 65 or over, you may be able to contribute the proceeds of selling your home into super, and be exempt from some of the normal super contribution rules and limits.

What are ‘downsizer contributions’?

From 1 July 2018, if you’re aged 65 or older and have owned your house for at least 10 years, you may be able to contribute up to $300,000 ($600,000 per couple) into super from the proceeds of selling your home.

Downsizer contributions are different to normal contributions to super in some important ways:

  • If you’re 65 or over and eligible to make a downsizer contribution, you don’t need to be working.
  • Downsizer contributions are made ‘after tax’ (i.e. there are no tax concessions), however they’re not subject to the normal after-tax (non-concessional) contributions caps.
  • You can contribute up to $300,000 per person or $600,000 per couple using the net sale proceeds (in addition to any other caps that may apply to you).
  • You can make a downsizer contribution even if it will take your total super balance above the $1.6 million cap. But keep in mind it will count as part of your total super balance in future financial years.
  • Downsizer contributions do count towards the transfer balance cap if you open a pension account.
  • Other eligibility rules apply, e.g. the type of home that can be downsized, eligible amounts that can be contributed, and timeframes of ownership, etc.
  • You can only make downsizing contributions for the sale of one home.
  • The ATO may reject your downsizer contribution on eligibility grounds. If your downsizer contribution is deemed ineligible, we may be able to accept the amount as a non-concessional contribution if you meet the work test and subject to contribution caps. For more information about contribution caps read our How super works booklet (PDF, 1.1MB).

How to make a downsizer contribution

Complete the relevant form from the ATO and send it to us after 1 July 2018, along with your cheque generally within 90 days of settlement. For more information about the scheme and for a copy of the relevant form, visit www.ato.gov.au.

Make your cheque payable to UniSuper Limited—write your UniSuper member number on the reverse side. Mail your form and cheque to:

UniSuper
Level 1, 385 Bourke Street
Melbourne VIC 3000

Seek advice

Like all important financial decisions, we recommend you speak with a qualified financial adviser before deciding if making a downsizer contribution is right for you.

It’s important to remember:

  • to check your eligibility to make downsizer contributions
  • your residential house is generally exempt from the Centrelink ‘assets test’ and super generally isn’t, so this could impact any entitlements you receive
  • to consider whether making a downsizer contribution is the most appropriate way to add money to super
  • your broader financial circumstances could impact your decision.

Contact UniSuper Advice on 1800 838 423 to check if a downsizer contribution is right for you.

Take a look at how UniSuper Advice can help you.