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First Home Saver Account
On October 1st, 2008 the Federal Government launched the First Home Saver Account scheme (FHSA) to help Australians save for their first home purchase and to make home ownership easier to achieve.
The incentive is open to all Australians above the age of 18 and is designed to provide tax breaks and savings incentives to help save for a first home with the aid of Government contributions, lower tax rates on your interest earnings and strict usage rules.
First Home Saver Accounts are different to regular savings accounts and high interest savings accounts. They also have certain criteria in which you will need to meet to be eligible to open one:
Unlike a normal savings account whereby interest is taxed at your marginal tax rate, interest earned in your First Home Saver Account will be taxed at 15%.
Your total account balance will be capped at $75,000 and no further deposits into the account will be accepted. Your savings can be withdrawn after the first 4 years of opening your account. Funds that have been withdrawn after this time period must be used to purchase or build a home that you will live in (so can't be used for investment purposes), in order to avoid having to pay tax.
As of Monday 13th October there are currently 23 institutions that offer First Home Saver Accounts.
More information on First Home Saver Accounts
The incentive is open to all Australians above the age of 18 and is designed to provide tax breaks and savings incentives to help save for a first home with the aid of Government contributions, lower tax rates on your interest earnings and strict usage rules.
First Home Saver Accounts are different to regular savings accounts and high interest savings accounts. They also have certain criteria in which you will need to meet to be eligible to open one:
- You are between the ages of 18 and under 65
- You cannot have previously built or bought a home to live in
- You have not had a First Home Saver Account before and do not currently have one
- You have a valid tax file number and must be provided to your account provider
- You are an Australian resident
Unlike a normal savings account whereby interest is taxed at your marginal tax rate, interest earned in your First Home Saver Account will be taxed at 15%.
Your total account balance will be capped at $75,000 and no further deposits into the account will be accepted. Your savings can be withdrawn after the first 4 years of opening your account. Funds that have been withdrawn after this time period must be used to purchase or build a home that you will live in (so can't be used for investment purposes), in order to avoid having to pay tax.
As of Monday 13th October there are currently 23 institutions that offer First Home Saver Accounts.
More information on First Home Saver Accounts
