On 7 September 2017, a series of Bills was introduced into the Parliament to move forward with the following "housing affordability" announcements made as part of the 2017/18 Federal Budget.
First Home Super Saver Scheme
From 1 July 2018, individuals can contribute up to $30,000 (up to $15,000 a year within existing caps) into superannuation and will be able to withdraw the contributions. These contributions, along with deemed earnings, can be withdrawn for a deposit with withdrawals taxed at a marginal tax rate less a 30% offset.
Downsizing the family home
From 1 July 2018, people aged over 65 will be able to make an additional nonconcessional contribution of up to $300,000 into superannuation when they sell their home which they have held for at least ten years. Both members of a couple can take advantage of this measure, meaning up to $600,000 of contributions may be made by a couple from the proceeds of selling their home.
Limiting rental property deductions
From 1 July 2017, owners of residential investment properties will have their deductions limited as:
- travel costs for individual investors inspecting and maintaining residential investment properties will no longer be deductible; and
- plant and equipment depreciation deductions to new assets only. Following feedback in the consultation process, investors will be entitled to claim plant and equipment depreciation deductions in situations where a developer/renovator tenants a property prior to selling it to an investor, provided the property is:
- purchased by an investor within six months of the property being completed by a developer/renovator; and
- the developer/renovator has not claimed depreciation deductions.
Please contact us if you have any queries about the housing affordability announcements.