If eligible, older Aussies can put up to $300,000 into their super using the money from the sale of their main residence, regardless of caps and restrictions that otherwise apply.

If you’re looking to boost your retirement savings, you may be able to make a tax-free contribution to your super of up to $300,000 using the proceeds from the sale of your main residence.

The good news is that thanks to changes first announced in the 2021-22 Federal Budget, the age Australians can make downsizer contributions was reduced from 65 to 60 from 1 July 2022.

Here are some things you’ll need to know if you’re considering using the proceeds of the sale of your home to top up your super.

Benefits of making a downsizer contribution

1. Downsizer contributions provide a way to top up your super balance

Older Aussies, who haven’t had the chance to save enough funds for retirement, may find that tax-free downsizer contributions provide a good opportunity to top up what they’ve saved to date.

2. No work test or upper age limits apply to downsizer contributions

3. Annual concessional and non-concessional contributions caps don’t apply

In fact, downsizer contributions can be made in addition to any concessional and non-concessional super contributions you may be eligible to make.

4. Downsizer contributions aren’t subject to the $1.7m total super balance restriction

You usually can’t make non-concessional contributions into your super if your total super balance is $1.7 million or above as at 30 June of the previous financial year. But this rule doesn’t apply to downsizer contributions.

5. There are no requirements to buy a new home

If you sell your main residence and make a downsizer contribution into your super, you’re not required to buy a new home with money you might make on the sale.

6. Both members of a couple can take advantage

For couples, both spouses can make the most of the downsizer contribution opportunity, which means up to $600,000 per couple can be contributed toward super.

Rules and other considerations to be aware of

  • Currently, you must be aged 60 or older to make a downsizer contribution
  • The property that’s sold needs to have been your (or your spouse’s) main place of residence at some point in time and you need to have owned the home for at least 10 years
  • The sold property must be in Australia and excludes caravans, mobile homes and houseboats
  • A downsizer contribution must be made within 90 days of receiving the sale proceeds
  • You can’t have previously made a downsizer contribution to super
  • The maximum amount of super savings (not including subsequent earnings) that can be transferred into a retirement pension increased to $1.7 million on 1 July 2021, but not for everyone. Find out more in our article - Transfer balance cap set to increase to $1.7 million. - Transfer balance cap set to increase to $1.7 million
  • Downsizing your home may impact age pension eligibility. There is no special Centrelink means test exemption for making downsizer contributions

Where to go for more information

Depending on your situation, other rules may apply, so do your research and chat with your adviser. If you don’t have an adviser but would like some advice, we may be able to help you find one near you.

Complimentary retirement health check

If you’re an AMP super member, you may like to arrange a call with one of our retirement specialists to discuss your super and retirement. To learn more and book in a chat, visit our info page.

Book now

What's next?

Get a guide how much you might need in retirement

What you need to know

Any advice and information is provided by AWM Services Pty Ltd ABN 15 139 353 496, AFSL No. 366121 (AWM Services) and is general in nature. It hasn’t taken your financial or personal circumstances into account. Taxation issues are complex. You should seek professional advice before deciding to act on any information in this article.

The retirement health check is a general advice conversation only. It is provided by AWM Services Limited (AWM Services) ABN 15 139 353 496, AFS Licence No. 366121 (AWMS) to eligible members of the AMP Super Fund. AWM Services is a wholly-owned subsidiary of AMP.

It’s important to consider your particular circumstances and read the relevant product disclosure statement, or terms and conditions, available from AMP at amp.com.au, or by calling 131 267, before deciding what’s right for you. The super coaching session is a super health check and is provided by AWM Services and is general advice only. It does not consider your personal circumstances.

You can read our Financial Services Guide online for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relation to products and services provided to you. You can also ask us for a hardcopy. All information on this website is subject to change without notice. AWM Services is part of the AMP group.