THANKS to an Australian Government initiative the release of the First Home Saver Account is making it simpler to buy your first home. By meeting some certain eligibility and savings criteria not only will your savings be taxed at a lower rate but the Government will also contribute to them.
There are a variety of institutions including the ANZ & Commonwealth Bank of Australia who are offering the account for people saving for their first home. Here are some facts to get you started.
How do I qualify and what do I need to do?
- Be aged between 18 and 65 and be a first home buyer.
- Some institutions are paying higher interest rates than others so choose from the available FHS Account institutions.
- Provide your Tax File Number when opening your account (no minimum deposit is required).
- To be able to withdraw your savings tax-free and buy/build your first home you must contribute $1000 after tax contributions over four financial years.
So what do I get?
- You can save up to a total of $75,000.
- Savings will be taxed at 15% instead of your usual marginal tax rate.
- The Government contributes a further 17% on the first $5,000 you make each year. So if you save $5,000 in a year you receive an extra $850 from the Government.
- Withdrawals are tax-free if they are used to purchase or build a first home to live in.
If you change your mind and you decide not to buy you can transfer your funds to your superannuation fund.
You can still claim the First Home Buyer's Grant.
- For further information check out more at the Australian Government's First Home Saver Account site.
To take advantage of this account let a ratesonline consultant help you make an informed decision and show you how you can benefit.
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