Tetlow Legal is operational and continuing to assist our clients, please read this notice.

A new Federal Government initiative, effective from 1 July 2018, enables those selling their home to contribute up to $300,000 into super (and where this is a couple, up to $300,000 each).

Although it is referred to as ‘downsizing contributions into super’, after the sale of your property, there is no requirement to buy a smaller or cheaper property, or any property at all!

It is also worth noting that even if your super has reached the cap of $1,600,000 you can still contribute the full $300,000 to your super.

Naturally there are conditions attached, but a few examples illustrate the possibilities:


  1. Brian and Penny have lived in their family home in Canberra for over 30 years. The property is in joint names. They will both turn 65 within the 2018-19 financial year. Brian is hoping to sell their house after they both turn 65.

In this instance they would both be able to contribute up to a maximum of $300,000 each into super. If they both make contributions, they can direct $600,000 total into their super.

(Brian just needs to convince Penny that they both want to sell the house!)

  1. Malcolm and Julie are a recently retired couple, both over 65. They sell their family home for $600,000. The residence was their home for just over 10 years. In this case, the title to the property is only in Julie’s name. Nonetheless, they can make a contribution of up to $300,000 each – a total of $600,00 into their super as a couple.
  2. Julia and Kevin are also both over 65. They sell their family home of 11 years, held in joint names, for $400,000. The maximum they can jointly contribute to super is $400,000. However, that contribution can be made as $200,000 each, or as $300,000 for Julia and $100,000 for Kevin.
  3. Tony is a single man over 65 whose family is pressuring him to retire soon. He sells his home of 24 years for $500,000. He can put $300,000 from this sale into his super.

To be eligible for this scheme, you need to comply with the following:

  • You must be aged 65 or over
  • You cannot contribute an amount greater than the total proceeds of your sale
  • You must have exchanged contracts for the sale of your property after 1 July 2018
  • Your home must have been owned by you, or your spouse, for 10 years or more, prior to the sale
  • Your home must be in Australia, and not be a caravan, houseboat or mobile home
  • The proceeds from the sale of your home must be either fully or partially exempt, or eligible to be exempt, from capital gains tax under the “main residence exemption”
  • You must advise your super fund that your contribution is a “downsizer” contribution; needless to say, there is a form required for giving such a notification
  • The downsizer contribution must be made within 90 days of receiving the proceeds from the sale of your home; sale proceeds are usually received upon settlement
  • You can only make the downsizer contribution once
  • Downsizer contributions are not tax deductible

Naturally, before entering into an arrangement of this nature, we recommend that you obtain:

  • Your partner’s permission to sell the family home!
  • Financial advice from a qualified financial planner; and
  • Legal advice regarding your eligibility in relation to the sale itself

Greater contributions to superannuation can help make your retirement more comfortable and secure, and also reduce unnecessary reliance on other family members. To speak to Brian Tetlow or Emma Bragg about downsizing, please call (02) 6140 3263 or email [email protected] or [email protected].