The First Home Super Saver Scheme

What Is the First Home Super Saver Scheme?

The First Home Super Saver Scheme is a Federal Government initiative, administered by the Australian Taxation Office (ATO), that allows you to save for your first home through your super fund.

You do this by making voluntary contributions to super, on top of the compulsory contributions your employer already pays, and later withdrawing those voluntary amounts, along with associated earnings, to use as a deposit. Because money inside super is taxed at a concessional rate, most people end up with more in their pocket than if they'd saved the same amount through a regular bank account.

A few things to be clear about up front:

• You can only access voluntary contributions. Compulsory employer (Super Guarantee) contributions can't be touched.
• The money is released through the ATO, not paid directly out of your super fund.
• Your deposit savings stay inside super until you formally apply to release them, which adds a layer of discipline that a savings account doesn't.

The scheme pairs well with the other support available to first home buyers, see our overview of first home buyer loans for how it fits the bigger picture.

Who Is Eligible for the First Home Super Saver Scheme?

To use the FHSS scheme, you need to meet all of the following at the time you request a release of your savings:

• You are 18 years or older (you can make eligible contributions before 18, but you can't request a release until you are 18).
• You have never owned property in Australia, this includes an investment property, vacant land, commercial property, a lease of land, or a company title interest, not just a home you've lived in.
• You have never previously requested an FHSS release.
• You intend to live in the property as soon as practical and for at least six of the first 12 months after it's practical to move in.

Eligibility is assessed per person, not per couple. That's important: if you've previously owned property but your partner hasn't, your partner may still qualify on the same purchase.

What if I've owned property before?

You may still be eligible under the ATO's financial hardship provision if you previously lost property because of events such as bankruptcy, divorce or relationship breakdown, loss of employment, illness, or a natural disaster. You apply through myGov or a hardship form, and the ATO assesses each case individually, asking for evidence that the event caused you to lose the property.

It's worth checking your eligibility before you start contributing, so you can plan your strategy and avoid surprises later. A quick conversation with a broker can confirm where you stand, book a free chat with Stryve.

How the First Home Super Saver Scheme Works

Here's the part most articles get wrong, so read this section carefully: you don't get back 100% of everything you contribute.

When you withdraw under the FHSS scheme, the ATO lets you access:

• 100% of your eligible non-concessional contributions (after-tax personal contributions you haven't claimed a deduction for), plus
• 85% of your eligible concessional contributions (salary sacrifice, or personal contributions you've claimed a tax deduction for), plus
• An amount of associated (deemed) earnings on top.

The 85% reflects the 15% contributions tax already applied to concessional money going into super. Missing this is the single most common reason people overestimate how much they'll receive.

How associated earnings are calculated

You also get a top-up of “associated earnings”, but this is not your fund's actual investment return. The ATO applies its own deemed rate, calculated using a set formula (broadly based on the 90-day Bank Bill rate plus a fixed margin) and compounded daily. It's applied consistently regardless of how your specific fund performed, so the figure is predictable rather than tied to market movements.

A simple worked example

Say you salary sacrifice $15,000 into super in a year (a concessional contribution), and your marginal tax rate is 32% (including the Medicare levy):

• Through FHSS: the $15,000 is taxed at 15% going in, and you can later release 85% of it, $12,750 plus associated earnings. On release, that amount is added to your taxable income but taxed at your marginal rate minus a 30% offset, so roughly 2% in this example.
• Through a regular savings account: the same $15,000 of salary is taxed at 32% first, leaving about $10,200 to deposit.

That's roughly $2,500 more working towards your deposit per year, before any earnings, and the gap widens over two or three years of saving.

FHSS Contribution Limits, Caps and Tax Rules

This is where good planning pays off, because the FHSS limits sit inside the normal super contribution caps, they aren't a separate bonus.

Contribution and release limits

If you're buying with a partner who also qualifies, you can each access up to $50,000 of eligible contributions, up to $100,000 combined towards the same purchase.

The contribution caps still apply

Here's the trap: every dollar you salary sacrifice for FHSS also counts towards your normal concessional contributions cap, which is $30,000 for 2025–26. Personal after-tax contributions count towards the non-concessional cap of $120,000. Go over either cap and the excess isn't eligible for release, and you may face extra tax. This is exactly why FHSS contributions need to be planned alongside whatever else is already flowing into your super.

How the release is taxed

When your savings are released, the concessional portion and associated earnings are added to your assessable income in the year you request the release. They're taxed at your marginal rate, less a 30% tax offset. For most working Australians that means an effective tax rate of just a few percent. If the ATO can't determine your marginal rate, a flat 17% is withheld instead, and adjusted at tax time.

One more important rule: if you claim a tax deduction on personal contributions, you must lodge a Notice of intent to claim a deduction with your super fund before you apply for your FHSS determination. Get the order wrong and the contributions may not be treated correctly.

How to Apply for the First Home Super Saver Scheme

Applying is a multi-step process through the ATO, and the order matters. Here's how it runs from start to finish.

Step 1: Make eligible voluntary contributions

Start contributing through either:

• Salary sacrifice (concessional), arranged through your employer's payroll, or
• Personal after-tax contributions (non-concessional) paid directly to your fund.

Confirm with your payroll or fund that contributions are being recorded correctly, incorrectly classified contributions won't be eligible.

Step 2: Request an FHSS determination

Log in to myGov linked to ATO online services and request an FHSS determination. This tells you the maximum amount you can release, including your eligible contributions and deemed earnings. It's a confirmation only, not the actual release.

Crucially, you must request your determination before ownership of any property transfers to you, once you own real property, you can no longer request one.

Step 3: Request the release of funds

After you have your determination, submit a separate release request through myGov. The ATO instructs your super fund to release the amount, withholds the applicable tax, and pays the balance to your nominated bank account. Allow roughly 15-25 business days for this to flow through, so build that buffer into your buying timeline.

Step 4: Sign a contract to buy or build

Once your funds are released, the clock starts. You have 12 months to sign a contract to buy or build a residential home in Australia. If you need more time, you can apply to the ATO for a single 12-month extension (24 months total).

Step 5: Notify the ATO

You must notify the ATO within 28 days of signing your contract, again through myGov. If you don't end up buying, you can either recontribute the funds to super (treated as a non-concessional contribution) or keep them and pay a flat 20% FHSS tax on the released amount.

Because the release timing has to line up with settlement, it pays to have your finance sorted in parallel. Getting home loan pre-approval early means you're not waiting on two clocks at once, see our pre-approval guide for what's involved.

How to Withdraw Your FHSS Funds

To recap the withdrawal mechanics in one place, because “how to withdraw super for a first home” is where people get stuck:

1. You can't withdraw directly from your super fund, everything goes through the ATO.
2. Request your determination, then your release, via myGov.
3. The ATO withholds tax (your marginal rate minus the 30% offset) before paying you.
4. Funds land in your bank account, typically within 15-25 business days.
5. From there you have 12 months to sign a contract.

The biggest risk when accessing super for a home loan deposit is timing, a release stuck in processing can put a settlement date at risk. Mapping the path from approval to settlement early helps you avoid that squeeze.

FHSS vs Saving in a Regular Account

Should you use the scheme, or just save the normal way? For most eligible first home buyers the FHSS scheme comes out ahead, but it's worth seeing the numbers honestly, with the 85% release rule applied.

Here's what saving $15,000 per year for three years ($45,000 total, within the $50,000 lifetime cap) looks like via salary sacrifice:

Figures are illustrative only and assume a 32% marginal rate. Your actual outcome depends on your income, contribution mix and the ATO's deemed earnings rate. This is general information, not financial advice.

Why FHSS often wins

• Lower tax in: concessional contributions are taxed at 15%, well below most marginal rates.
• Favourable tax out: the 30% offset on release keeps the exit tax low.
• Forced discipline: funds are locked in super, so there's less temptation to dip in.

The trade-offs

• Restricted access: you can't touch the money until you apply for release.
• Strict timing: 12 months to sign a contract (or apply for an extension).
• Processing lag: 15-25 business days to receive funds.
• It counts towards your caps: as covered above.

A practical approach is to use FHSS alongside a regular savings account, the scheme for the tax-effective bulk of your deposit, and cash savings for upfront costs like inspections, conveyancing and loan fees. Our tips on saving your first home deposit and the hidden costs of buying cover those extras.

Combining FHSS with Other First Home Buyer Schemes

One thing the ATO and the big banks won't map out for you is how the FHSS scheme stacks with the other support available. In most cases you can combine it with:

• The First Home Owner Grant (FHOG), see our first home buyers grant guide and the NSW first home owner grant.
• The First Home Guarantee, which can let you buy with as little as a 5% deposit and no LMI, covered in our First Home Guarantee scheme page.
• The Help to Buy shared-equity scheme, we compare the options in Help to Buy vs the First Home Guarantee and on our Help to Buy page.
• Stamp duty concessions, which vary by state, see stamp duty for first home buyers.

The FHSS scheme and these schemes generally operate independently, so layering them can meaningfully cut what you need to save and borrow. A broker can model the combination that gets you to settlement soonest.

FHSS for Self-Employed First Home Buyers

If you're self-employed, the FHSS scheme can be especially useful, because you don't have an employer running salary sacrifice for you. Instead, you make personal contributions to your fund and claim them as a tax deduction, which makes them concessional, and eligible for FHSS.

The key step is lodging the Notice of intent to claim a deduction with your fund before requesting your determination, and keeping your contributions within the $30,000 concessional cap. Done right, it's a tax-effective way to build a deposit on a variable income.

Self-employed borrowers also face tighter lending criteria, so it's worth getting your finance position clear early, see our self-employed home loans and sole trader home loans pages.

Common FHSS Mistakes to Avoid

A few errors come up again and again:

• Assuming you get 100% back. You release 85% of concessional contributions, not the full amount.
• Exceeding your contribution caps. FHSS amounts count towards the $30,000 / $120,000 caps, go over and the excess is ineligible.
• Wrong order of steps. Requesting a release before the determination, or buying before requesting the determination, can derail your claim.
• Forgetting the 28-day notification after signing a contract.
• Underestimating processing time and missing a settlement date.

Our roundup of first home buyer mistakes and the first home buyer checklist are worth a read before you start.

How a Mortgage Broker Helps With FHSS

Most of the focus with FHSS lands on the super side. But your home loan strategy is the other half, and it's where timing makes or breaks the plan. At Stryve Finance we help first home buyers:

• Build a deposit plan that maps how much to contribute, in which form, and when to start.
• Coordinate the FHSS release with your loan, lining up pre-approval and contract dates so funds arrive in time for settlement.
• Bundle the available schemes, FHSS, FHOG, the First Home Guarantee and stamp duty concessions, so every dollar of support is working for you.

If you're weighing up whether to go it alone, our piece on why use a mortgage broker lays out the difference.

Ready to put FHSS to work?

We'll help you use the First Home Super Saver Scheme strategically, so your super and your home loan pull in the same direction. Book a free consultation with a Stryve Finance broker and get your deposit strategy sorted.

First Home Super Saver Scheme FAQs

Can I use the FHSS scheme with my partner?

Yes. Eligibility is assessed individually, so if you both qualify you can each access up to $50,000 of eligible contributions, up to $100,000 combined towards the same home.

How much of my super can I actually withdraw?

You can release 100% of eligible non-concessional (after-tax) contributions, 85% of eligible concessional (salary sacrifice or claimed) contributions, plus associated earnings calculated by the ATO, all within the $15,000-per-year and $50,000-lifetime limits.

How long does it take to receive FHSS funds?

The ATO generally processes a release within about 15-25 business days after approval. It isn't instant, so plan ahead so it doesn't clash with your settlement.

What happens if I don't buy a home in time?

You have 12 months from your release to sign a contract, extendable to 24 months. If you don't, you either recontribute the funds to super (as a non-concessional contribution) or pay a flat 20% FHSS tax on the released amount.

Can I combine FHSS with the First Home Owner Grant?

In most states and territories, yes. The FHSS scheme generally operates independently of grants like the FHOG, stamp duty concessions and low-deposit options such as the First Home Guarantee, so they can usually be combined.

Is the FHSS scheme still worth it?

For many eligible first home buyers, yes, the combination of a 15% tax rate going in and a 30% offset on release makes it one of the more tax-effective ways to build a deposit, particularly over two or three years. It isn't right for everyone, so it's worth weighing up against your income, timeline and goals with a broker.