In short: Salary sacrifice $12,000 a year for four years on a $95,000 income and you put $48,000 into super before tax. After the 15% contributions tax that is $40,800, and after the 30% FHSS offset you pay just $816 of tax on release, leaving $39,984 for your deposit. Saving the same gross amount in a bank account leaves $32,640. You are $7,344 ahead.
- Contributed before tax$48,000
- After 15% contributions tax in the fund$40,800
- Releasable (85% of concessional contributions)$40,800
- Tax on release, after the 30% FHSS offset$816
- Net in your hand$39,984
- If you had saved the same gross amount outside super$32,640
- Advantage of using the FHSS scheme$7,344
Caps: $15,000 of eligible voluntary contributions in any one financial year, $50,000 in total across all years. Earnings on the contributions are also released and are excluded from this estimate. You must request a determination BEFORE signing a contract. Confirm the current rules at ato.gov.au — this is an estimate, not tax advice.
Amount available for your deposit: $39,984
That is a general estimate on standard assumptions. Every lender applies its own expense benchmarks, income shading and policy, so the real figure moves from lender to lender. Gorakh spent years as a senior credit officer deciding exactly these questions. Send him the numbers above and he will tell you what is realistic and which lenders fit — at no cost to you for home loans.
- A former senior credit officer reads itGorakh assessed loan applications on the lender side before he became a broker.
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The First Home Super Saver scheme lets you save a deposit inside super, where contributions are taxed at 15% instead of your marginal rate, then release the money to buy your first home. It is one of the few genuinely free lunches in Australian personal finance, and most first home buyers have never used it.
How this calculator works
Enter your gross income, the voluntary contribution you plan to make each year, how many years you will contribute, and whether a partner is contributing too. The tool applies the annual and lifetime caps, deducts the 15% contributions tax, works out the tax payable on release after the 30% offset, and compares the result with saving the same gross amount outside super.
What counts as a contribution
Only voluntary contributions count. Your employer's compulsory superannuation guarantee does not, no matter how large it is. Eligible contributions are salary sacrifice arrangements you set up with your employer, and personal contributions you make and then claim as a tax deduction. After-tax personal contributions that you do not claim a deduction for also count, and are released at 100% rather than 85%.
The caps
- $15,000 of eligible voluntary contributions in any one financial year.
- $50,000 in total across all years.
- Contributions also count towards your normal concessional contributions cap, so a large employer contribution can crowd out the room you have to salary sacrifice.
The 85% rule
Only 85% of your eligible concessional contributions can be released, because the fund keeps the 15% contributions tax. On $48,000 contributed, $40,800 is releasable. Deemed earnings on the contributions are released as well and are not included in the calculator's figures, so a real determination is usually a little higher than the estimate here.
Worked example
You earn $95,000 and salary sacrifice $12,000 a year for four years, then buy your first home in Craigieburn.
| Step | Amount |
|---|---|
| Contributed before tax over four years | $48,000 |
| Less 15% contributions tax in the fund | $40,800 |
| Releasable amount (85% of concessional contributions) | $40,800 |
| Tax on release, marginal rate less the 30% offset | $816 |
| Net in your hand for the deposit | $39,984 |
| Same gross amount saved outside super | $32,640 |
| Advantage of using the scheme | $7,344 |
The arithmetic. On $95,000 your marginal rate including the Medicare levy is 32%. Contributions into super are taxed at 15%, so $48,000 becomes $40,800. On release the assessable amount is taxed at your marginal rate less a 30% offset, which is 32% minus 30%, so 2% of $40,800 equals $816. That leaves $39,984.
Outside super, the same $48,000 of gross salary would have been taxed at 32%, leaving $32,640 in a bank account before any interest. The difference is $7,344, and you did not have to do anything clever to earn it.
Worth noticing: sacrificing $12,000 of gross salary only reduces your take-home pay by about $8,160 a year, because you were never going to see the $3,840 of tax. Over four years you are out of pocket roughly $32,640 in cash and you get $39,984 back. Our income tax calculator shows what the sacrifice does to your fortnightly pay.
As a couple
The caps are per person, not per property. If both of you contribute $12,000 a year for four years on similar incomes, the combined release is $79,968 with a combined advantage of $14,688. At the full $50,000 lifetime cap each, a couple can release six figures.
That is a meaningful deposit. On a $650,000 first home, $79,968 covers a 10% deposit with change towards costs. Combined with the First Home Guarantee, which needs only 5% and removes lenders mortgage insurance, it can lift you from scraping in to buying comfortably.
The rules that catch people out
Request the determination before you sign
You must apply to the ATO for an FHSS determination and, in practice, have the release process under way before you sign a contract to buy. Signing first can cost you access to the scheme entirely. This is the single most common and most expensive mistake, and it is completely avoidable.
Release takes time
Allow several weeks between requesting a release and the money reaching your bank account. Plan the timing against your deposit and settlement dates, not against your auction date.
Timeframes after release
Once the money is released you generally have a limited period, commonly twelve months with the possibility of an extension on request, to sign a contract to buy or build. If you do not, you generally have to recontribute the amount to super or pay an additional tax on it. Check the current timeframes at ato.gov.au before you release.
Eligibility basics
You must be 18 or over, have never owned property in Australia, and intend to live in the home for at least six of the first twelve months. Eligibility is assessed per person, so if one of you has owned before, the other may still qualify. Full detail is in our First Home Super Saver scheme guide.
What this calculator does not include
- Deemed earnings on your contributions, which are also released. The real figure is usually higher than shown.
- Investment returns or losses inside the fund. Deemed earnings are calculated on a set formula, not on your fund's actual performance.
- Interest you would have earned on money saved outside super, which narrows the gap slightly.
- The Division 293 tax for very high earners, and any effect of contributions on other entitlements.
- Fund rules. Some funds handle release requests faster than others. Check yours before you start.
Combine this with the deposit savings calculator to see how the scheme fits alongside ordinary saving, and how much deposit do I need for the target you are aiming at.
Frequently asked questions
How much can I withdraw under the First Home Super Saver scheme?
Up to $50,000 of eligible voluntary contributions in total, with no more than $15,000 counted from any one financial year, plus deemed earnings on those contributions. Only 85% of before-tax contributions is releasable. A couple who both qualify can each use the full cap against the same property, so the combined amount can be substantially higher.
Does my employer's super count towards the FHSS scheme?
No. Compulsory superannuation guarantee contributions from your employer are not eligible, and neither are contributions from a spouse or amounts covered by a contributions-splitting arrangement. Only voluntary contributions you make count: salary sacrifice you arrange with your employer, personal contributions you claim as a deduction, and after-tax personal contributions.
How much tax do I pay when I release the money?
The assessable portion is taxed at your marginal rate less a 30% offset. On a $95,000 income the marginal rate including the Medicare levy is 32%, so the effective tax on release is 2%, which is $816 on a $40,800 release. If your marginal rate is 30% or below, the offset can reduce the tax to nil.
Can I use the FHSS scheme with the First Home Guarantee or the First Home Owner Grant?
Yes. They are separate programs with separate eligibility and they stack. FHSS builds the deposit, the First Home Guarantee lets you buy with 5% and no lenders mortgage insurance, and the Victorian First Home Owner Grant adds $10,000 on a qualifying new home. Check each set of rules separately.
What happens if I do not end up buying?
You generally have around twelve months from release to sign a contract, with an extension available on request. If you still do not buy, you normally recontribute the released amount to super or pay an additional tax on it. Either way the money is not lost, but the timing matters, so confirm the current rules with the ATO before releasing.
Talk to GNT Finance
The scheme works best when it is planned alongside your loan, not bolted on at the last minute. Gorakh Timilsina can map the timing of your contributions, your determination, your release and your pre-approval so nothing collides on the way to settlement. See our first home buyer loans page for the full picture.
Book a free consultation or call 0426 403 703.
This page is general information only and not legal, tax or financial advice. Laws change — confirm current rules with the State Revenue Office, the ATO or a licensed professional.
Written by Gorakh Timilsina
Founder, CEO & Senior Mortgage Consultant at GNT Finance. Gorakh started as a broker assistant, spent years as a senior credit officer assessing loan applications, and now helps Melbourne families get the right loan approved. English, Nepali and Hindi spoken.