A couple can each put up to $50,000 of voluntary super contributions toward a first home deposit under the First Home Super Saver Scheme, which means $100,000 combined before you have even touched genuine savings outside super. The catch is timing. Money moves slowly inside superannuation, and getting the sequence wrong can delay a purchase by months.
What the First Home Super Saver Scheme actually does
The First Home Super Saver Scheme, known as FHSSS, lets first home buyers put extra money into their super fund and later withdraw it to help fund a deposit. Contributions grow inside super, which is taxed at a flat 15% rather than your marginal income tax rate, and the scheme is designed to give savers a tax advantage over holding the same money in a standard bank account.
Each person can contribute up to $15,000 per financial year and $50,000 in total under the scheme. Couples buying together can each use their own $50,000 cap, which is where the combined $100,000 figure comes from. Contributions can be voluntary concessional (salary sacrifice, taxed at 15% going in) or voluntary non-concessional (after-tax money you choose to add).
How much you actually get back
When you withdraw FHSSS funds, non-concessional contributions come out tax free because you already paid tax on that money before it went in. Concessional contributions and the earnings on all FHSSS money are taxed at your marginal rate, but you receive a 30% tax offset, which usually leaves you well ahead of where the same savings would have sat outside super.
Is salary sacrificing into FHSSS always better than a regular savings account?
For most income earners it produces a better after-tax outcome, since concessional contributions are taxed at 15% rather than a marginal rate that can reach 47%. Whether it suits your circumstances depends on your income, how soon you plan to buy, and your other financial priorities, so it is worth discussing with an accountant or financial adviser before committing to a contribution strategy.
The eligibility rules that catch people out
You must never have owned property in Australia, including an investment property, to use the scheme. You need to be at least 18 to request a release, though you can start contributing earlier. The home you buy must be one you intend to live in for at least six months within the first 12 months of ownership, and this applies whether it is an established home, a new build, or vacant land you intend to build on.
The step people miss most often is the FHSSS determination. Before you sign a contract of sale or apply for a release of funds, you need to request a determination from the ATO confirming how much you are eligible to withdraw. Applying for the actual release happens after you have signed a contract, but the determination should be sorted well ahead of time so you know your numbers before you make an offer.
Why the timing trips people up
Processing a FHSSS release is not instant. The ATO typically takes around 15 to 25 business days to process a valid release request once it has been submitted, and your super fund needs to release the money to the ATO first, which adds its own processing time on top. If you are relying on FHSSS funds as part of your deposit and you sign a contract with a short settlement period, you can end up in a genuinely stressful position waiting for funds to clear.
A practical approach many first home buyers use is requesting the determination as early as possible, ideally before house hunting begins in earnest, and building a longer settlement period into any offer where the FHSSS money forms a meaningful part of the deposit. Speaking with your broker about how a lender views funds still sitting inside the scheme can also help you structure pre-approval around a realistic timeline.
How lenders treat FHSSS funds in a loan application
Most lenders are comfortable counting FHSSS savings as genuine savings once the funds have actually been released and are sitting in your bank account, since the money has effectively been held and accumulated over time. Some lenders want to see evidence of the FHSSS determination and release documentation as part of the application, so keeping clear records of each step protects you from delays later in the process.
Where the scheme fits well is alongside other deposit sources such as regular savings, the First Home Guarantee, or a family gift, rather than as the sole source of a deposit. Combining strategies gives you more flexibility if the FHSSS release timeline runs longer than expected, and a broker experienced with first home buyers can help sequence everything so a settlement date is not put at risk by a single moving part.
Key Takeaways
- Individuals can contribute up to $15,000 per year and $50,000 in total to the First Home Super Saver Scheme, giving couples a combined $100,000 cap.
- Concessional contributions are taxed at 15% going in, and withdrawals attract a 30% tax offset, which usually beats saving the same amount outside super.
- You must request an ATO determination before signing a contract of sale, and the actual release can take several weeks to process once requested.
- The property must be lived in for at least six months within the first 12 months of ownership, and you cannot have previously owned property in Australia.
- Building a longer settlement period into an offer helps avoid delays when FHSSS funds form part of the deposit.
- Speaking with an accountant about contribution strategy and a broker about how lenders assess released funds helps the whole process run to schedule.