The downsizer contribution provides an excellent opportunity for anyone aged 65 or over who sell their main residence (your home) held for at least 10 years to contribute up to $300,000 each ($600,000 for a couple) into super. The usual work test and total super balance restrictions do not apply when making a downsizer contribution. Only Contracts of Sales entered into from 1 July 2018 may qualify for a downsizer contribution.
Implications for investors
· You do not have to actually downsize living accommodation to be eligible and can be moving into Aged Care.
· Downsizer Contributions are not tax deductible and may impact Centrelink Age Pension.
· Downsizer Contributions converted to a tax free super pension count towards your transfer balance cap.
· Downsizer Contributions needs to be made within 90 days of receiving sale proceeds.
· Downsizer Contribution amount cannot be greater than total main residence sale proceeds.
This is a complex area, so if you (or anyone you know) are looking to downsize your home, contact Michael Stout on 97838077 to discuss the suitability of this strategy.
RetireInvest / RI Advice Frankston, Level 3, 454 Nepean Highway, Frankston
Michael Stout is an Authorised Representative of
RI Advice Group Pty Ltd ABN 23 001 774 125, AFSL 238429
The information (including taxation) above is general advice only and does not constitute personal advice. It has been prepared without taking into account any of your individual objectives, financial solutions or needs. Before acting on this advice you should consider the appropriateness of this advice, having regard for your own objectives, financial situation and needs. You should seek personal financial advice from a qualified financial adviser before acting on the advice.