Government passes super scheme laws

11-Dec-2017

By Sarah Kendell

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The government has successfully passed its First Home Super Saver Scheme through parliament, meaning home-buyers and retirees will be able to make the most of the new incentives from the beginning of next financial year.

In a statement, Treasurer Scott Morrison said the new scheme would allow those saving for their first home to contribute up to $15,000 a year, and $30,000 in total, into their super account to accelerate the accumulation of a deposit.

Savers would be able to make their first withdrawals from the scheme from 1 July 2018 which would include deemed earnings on top of what they had put into super.

Earnings would be calculated by the Australian Taxation Office (ATO) using the shortfall interest charge, which equated to the 90-day bank bill rate plus 3 per cent.

“This will give first home buyers a significant leg-up towards saving their deposit, helping them overcome a key barrier for getting into the housing market,” Morrison said.

At the same time, retirees could take advantage of new downsizing incentives after 1 July by selling their current home and putting up to $300,000 of the sale proceeds into their super, which would be excluded from the new contributions caps.

“This will encourage older Australians, where appropriate, to free up homes that no longer meet their needs for younger growing families,” Morrison said.

Additionally, the government has passed legislation to bring whistleblowing protections for those in the corporate and financial sector further into line with public sector protections.

Minister for Revenue and Financial Services Kelly O’Dwyer said the new laws aimed to ensure “maximum consistency” across whistleblower protections for all types of organisations.

They would apply to disclosures received from 1 July 2018, although such disclosures could be about matters that occurred before this time, she said.

While O’Dwyer conceded the laws did not encompass all recommendations from the recent Parliamentary Joint Committee for Corporations and Financial Services inquiry into whistleblower protections, she said the government was “considering the remaining recommendations” and would release a further response in due course.

O’Dwyer also announced that Treasury would conduct a review into the current early release rules for super, given these had not changed for two decades.

“The super system has come a long way since then – it is time to review the current arrangements as they relate to severe financial hardship and compassionate grounds to ensure they remain fit for purpose,” she said.

Treasury would release an issues paper on the subject before the end of the year and make recommendations to government in early 2018.

At the same time, responsibility for administering the early release of super would transfer from the Department of Human Services to the ATO.

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