If you are over age 65 and sell your principle residence which you have lived in for 10 years or more, you can make a “downsizer” contribution of up to $300,000 into superannuation (up to $600,000 for a couple).
Downsizer contributions provide greater flexibility for many older people to top up their superannuation balances because:
- They are not counted against your concessional or non-concessional caps;
- They can be made regardless of the member’s total superannuation balance, and
- They are not subject to the “work test”, which otherwise requires a member over 65 to have worked a minimum of 40 hours in any period of 30 consecutive days before a contribution is made.
- However, it is essential to understand the rules before making any contribution.
Your home must have been owned by you, your spouse, your former spouse, or the trustee of your deceased spouse for the 10 years prior to you selling.
You must be 65 or older, the contribution must be made to a complying superannuation fund and you must not have previously made a downsizer contributions in relation to an earlier disposal of a main residence.
The amount of the contribution must be equal to, or part of, the proceeds from the sale of you home. The sale of your holiday house, investment property, caravan, houseboat or other mobile home does not qualify.
Despite the name “downsizer”, it isn’t necessary to purchase a replacement main residence in order to qualify. However, the contribution must be made within 90 days after ownership of the main residence changes (usually 90 days after settlement). You must complete and submit ATO downsizer contribution form to your super fund that either before or at the time you make the contribution.