Government to cut over-65 age limit to 60 on $300K super contribution from sale of the family home

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Good news for downsizers and land lease operators.

Ahead of the formal announcement of the Federal Budget tonight, it has been revealed that the Government’s downsizer scheme will be extended to people aged 60 in an effort to increase retirement savings and free up housing.

As we reported here, the Morrison Government first introduced the measure in the 2017-18 Budget, allowing over-65s to make a non-concessional contribution of up to $300,000 ($600,000 for couples) to their super from the proceeds of selling the family home, from 1 July 2018, provided the property has been owned for at least 10 years.

Separately, self-funded retirees will also be able to top up their super more easily as the budget will abolish the work test, which currently applies to contributions made by people aged between 67 and 74.

Both measures will start from 1 July 2022.

The move is designed to give retirees more control over their cash.

What it will deliver is more incentives for long-time homeowners to sell up and downsize – and move into a retirement community.

Savvy marketers should be looking now at how they can reach this market.

Retiree parents helping their adult children into the property market are already being given a push to free up equity – see the next story.