5 Mistakes That Makes First Home Super Saver Scheme (FHSSS) Useless in 2024
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- Опубликовано: 24 июл 2024
- 5 Mistakes to Avoid Using First Home Super Saver Scheme (FHSSS). This is a Guide for every Australian first home buyer in 2024 to use the FHSS Scheme effectively. Avoid these 5 mistakes to make the best use of the FHSSS. I hope you find it useful! Enjoy x
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FHSS Scheme Changes from September 2024 (Australia)
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Why I WON'T Use Salary Sacrifice For First Home Super Saver Scheme (FHSSS)
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⌚️Timestamps:
00:00 - Intro
01:22 - Mistake 1
05:39 - Mistake 2
08:15 - Mistake 3
09:37 - Mistake 4
11:56 - Mistake 5
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⭐Bonus: Stay informed about the upcoming changes to the FHSSS effective from the 20th of September 2024, which promise to introduce much-needed flexibility to the scheme.
🔗 LINKS MENTIONED:
ATO's FHSSS Page: www.ato.gov.au/individuals-an...
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📚Disclaimer: This video is for educational purposes only and is not intended as financial advice. Always conduct your research or consult a professional before taking action based on this content.
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Check out this video to learn about *FHSS Scheme Changes from 15th of September 2024 (Australia)* This means mistake #4 discussed in this video can be mitigated.
ruclips.net/video/gs8IB6tABAc/видео.html&ab_channel=RuiShi
Great Video. We have been going for the sprinter approach :) . It has been a good saving scheme for last couple of years as you forget its being salary sacrificed. I have just learned about the earnings being determined by the SIC rate and am super happy with it being at 7.3% and extended at same rate for April-June. better then the saving accounts - macquarie 5.5% and rabbo 5.75%
Hey there! I'm glad to hear the sprinter approach has been beneficial for you. 😊Just a heads-up: Your superfund's return is your money's actual return. The SIC is a rate the ATO applies when deciding the amount to release to you. For example, if your super generates 5%, the ATO will use the non-FHSS part of your super to make up the difference when releasing funds to you.
Thanks for watching, and stay tuned for more insights! x
I understand about you mentioning that it is better (tax advantage) to spread the $50000 over 10 financial years ($5000 per financial year) rather than do $15000, $15000, $15000, $5000 in 4 financial years but imagine how much more the property price might be from the 6 year difference... Using 2024 as an example for doing it over 4 years, a 20% deposit required in 2028 might be $250,000 (based on a $1.25m property) BUT if you use the 10 year method you mentioned, a 20% deposit in 2034 might be more like $350,000-$400,000 (if we are to believe that the same property might be more like $1.75-$2m in 2034). Therefore, it wouldn't be worth it to do it over 10 financial years vs 4 financial years if you believe property prices will continue to rise (which is almost certain knowing the high demand in Australian property). You would rather get it over and done with asap even if it means you might be missing out on some tax savings because it cannot be compared to how much more you will have to cough up in a deposit for a property by taking longer to have the funds ready.
Hey there! You've raised a great point. If someone is prepared and financially able to enter the market sooner, they definitely should take that step sooner rather than later.My mention of a 10-year timeframe wasn't to suggest that people should wait that long before entering the property market. Instead, I meant that if someone knows they don't want to or won't be able to buy for a longer term-whether that’s in 5, 7, 10, or even 15 years-they might consider using the FHSSS during that matching period. Hope this makes sense. x
Hi Rui, nice video!
I am wondering if I need to register or do anything for my super contribution to categorise as funds for FHSS? In other words, how do I ensure the funds that I am transferring personally be eligible for withdrawal?
Or do I simply just transfer the money to my Super and lodge a notice of intent and that's it?
Thank you!
Hey there! Thanks for your question! You've got it right-no need to register or do anything special, just transfer the funds to your Super and lodge a notice of intent to claim a tax deduction. Just make sure you get an acknowledgement letter from your superfund confirming your notice of intent has been successfully processed. Hope that helps! x 😊
@@OZRuiShi it does! Thank you 🙏🏻
Thanks for watching ❤what did you take away from this video?
How long does it take to receive a determination? Is it instant or does it take time to process if so how long?
Hi there, the processing time for a First Home Super Saver Scheme (FHSSS) determination is typically quick and often instant when submitted online through your myGov account. This is because the necessary information is already available and the calculation is straightforward.
However, the time can vary depending on the completeness of your application and whether additional information is required. If any issues arise or further information is needed, the processing time might extend beyond the instant determination.
Check out this ATO Community page where it discusses the expected processing times and procedures for FHSSS applications. community.ato.gov.au/s/question/a0J9s0000001FHC/p00035029
Hope this helps. x
@@OZRuiShi thank you so much for the reply 🙏 I’ve recommended your channel to my friends!
@@Cherry-wz8uq Thank you so much! I really appreciate you recommending my channel to your friends. Your support means a lot! 😇
Hi, during the whitdrawal of $50000 for FHSSS do i need to pay another tax ? 20 %?
Hi there, if the $50,000 represents concessional contributions you made throughout the years, then yes, the tax rate on that will be your marginal tax rate, including the Medicare levy, minus a 30% tax offset. If it was from non-concessional contributions, then there is no tax. Tax is applied in the financial year in which you requested the release, not when you receive the money. Hope this helps. x
Check out the ATO's FHSS Scheme for more detailed information.
www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/withdrawing-and-using-your-super/early-access-to-super/first-home-super-saver-scheme#ato-ReceivingyourFHSSamount
I'm not a big fan of the scheme. The extra hassle to potentially make 15 percent more. But if done over many years most people will be at higher tax brackets on release, so reducing that benefit. Some supers also charge fees, reducing it further again. Maybe it will be better in the future.
Hi there!🖐️ Thanks so much for sharing your thoughts. You've really highlighted some important complexities and potential downsides of the scheme, and it's crucial to weigh these carefully since everyone's financial situation is unique.
I wanted to share that this scheme is evolving, with some changes taking effect from 20/09/2024. I'm preparing a video to cover these updates in detail. If you're curious about how these changes might address your concerns, I'd love for you to check it out. Stay tuned, and thanks again for your valuable input! 😀
You can only pull out a maximum of $50,000.00 put in your super over the last 5 financial years. Depositing it over 10 years equally will lead to you only being able to withdraw $25,000 minus taxes, fees, etc..
Hey there, it is "up to a total of $50,000 contributions across all years.", not the last 5 financial years. 😊 www.ato.gov.au/individuals-and-families/super-for-individuals-and-families/super/withdrawing-and-using-your-super/early-access-to-super/first-home-super-saver-scheme
So is there no tax benefit to doing an after tax non concessional contribution? Like If i put in 15000 of my after tax income i get no benefit?
Hi there, thank you for your question! There are no tax benefits for making an after-tax non-concessional contribution. While you do get to withdraw the associated earnings from your super, there are no tax benefits for the amount you put in. Hope this clarifies it! 😊
Hi Rui, thank you for this video. So I am planning to contribute 15k to my super via salary sacrifice by the end of this fiscal year. Do I need to submit the notice of Intent to claim a tax deduction on the 15k?
Hey there! If you're planning to salary sacrifice, then you don't need to submit a notice of intent to claim a tax deduction. However, if you're making a personal concessional contribution, you will need to submit that form. I've covered the differences between these two options in a video called why I don't use salary sacrifice for FHSSS. I highly recommend checking it out for more details! ruclips.net/video/2s-PdgzAlME/видео.html
@@OZRuiShi Thank you for this information. So if I am contributing in salary sacrifice can I contribute upto 15,000 a fiscal year for the FHSSS or 15,000+15%= 17250 for the fiscal year?
If I am making a personal concessional contribution how much can I contribute 15,000 or 17250?
5:07 - The formula you have mentioned, I would like to clarify, will I be entitled to be taxed 30% on the salary Sacrifice done amount during the FY tax assessments? Ex: 10 K I made contributions to Super through employer salary Sacrifice ( purpose of FHSS) in the super account I was seeing contribution tax 15% done for the 10 K ( -1500) . When I do the withdrawal in FY 24 for FHSS, Will I be getting additional tax calculated based on my marginal income? Ex: consider 130 K as annual income
Appreciate your efforts on explaining this !
Hey there, the cap for FHSSS is $15,000 per financial year. This amount includes the 15% tax that will be taken out, so it is not $15,000 +15% tax.
Just be mindful of your concessional contribution cap so that your salary sacrifice plus employer contribution do not go over that cap. 😊
Yes, when you withdraw, the salary sacrifice you made in the past will be added to your other income and get taxed at your marginal tax rate, but you receive a tax offset of 30% on the salary sacrifice amount.
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