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SMSF Updates

Downsizer contributions

10 Jun, 2022

Downsizer contributions refer to a type of voluntary superannuation contribution in Australia that can be made by individuals aged 55 or over using the proceeds from the sale of their main residence.

Introduced in 2018, downsizer contributions allow eligible individuals to make a one-time contribution of up to $300,000 into their superannuation fund per person, or $600,000 per couple. These contributions are exempt from the usual age-based contribution limits and can be made even if the individual has already exceeded their contributions cap.

To be eligible to make downsizer contributions, the following criteria must be met:

  • The individual must be aged 55 or over at the time the contribution is made.
  • The contribution must come from the proceeds of selling their main residence, which must have been owned for at least 10 years.
  • The contribution must be made within 90 days of receiving the proceeds of the sale.
  • The individual must complete a downsizer contribution form and provide it to their superannuation fund before or at the time the contribution is made.

Downsizer contributions can be a useful strategy for individuals looking to boost their superannuation balance in retirement. However, it is important to consider the potential impact on other entitlements, such as the age pension, and to seek financial advice before making a downsizer contribution.

Downsizer contributions have the following benefits:

  • Not a non-concessional contribution and will not count towards contribution caps
  • The work test does not need to be meet and no upper age limit
  • Can be made by a member when they exceed their TSB



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