The Australian Government recently announced the Budget which included a list of changes for first home buyers, downsizers, and property investors. Here are the key highlights from the budget:
First Home Buyers
From 1 July 2017, those looking to buy their first home will be able to make voluntary contributions into their superannuation of up to $15,000 per financial year ($30,000 in total) to save for their deposit. They will be able to withdraw these contributions plus the deemed earnings on them from 1 July 2018.
From 1 July 2018, homeowners aged 65 years and over will be able to make an after-tax contribution to their super of up to $300,000 using the proceeds from the sale of their family home.
The house must be their principal residence and must have been held by them for at least 10 years. This after-tax contribution will also be exempt from the normal super contribution rules that generally prevent older Australians being able to invest in superannuation.
From 1 July 2017 tax deductions relating to expenses incurred whilst visiting investment properties will be no longer be allowed.
There are tighter rules planned around depreciation deductions for investment properties – in particular the plan to no longer allow subsequent owners of a property to claim deductions on items purchased by previous owners of the property.
Also, property investors who wish to invest in qualified affordable housing will move to a higher Capital Gains Tax discount of 60% (up from 50%).