First home saver account transfers
This section has information about:
FHSAs and super funds
A first home saver account (FHSA) is a savings account designed to offer a simple, tax-effective way of saving for a first home through a combination of government contributions and low taxes. FHSAs are operated by 'FHSA providers' - generally banks and other financial institutions.
If the savings in an FHSA are not used to buy or build a home the account holder will live in, they generally transfer the savings into a super account. Usually this is a once-off transaction with the whole of the account balance being transferred to a super provider when the FHSA holder permanently closes their FHSA account.
First home saver accounts can attract an FHSA government contribution (similar to a super co-contribution). Usually these are paid to FHSA providers but if an FHSA has been closed and the balance transferred to super before we make the payment, we need to pay the government contribution to the super fund that now holds the FHSA balance.
Treatment and reporting of FHSA transfers
When a FHSA provider sends the balance of the first home saver account to a superfund, the payment is a contribution into the super system (rather than a rollover or transfer within the super system). The contribution is:
- a member contribution for the purposes of SIS (for example, the contributions standards and the preservation rules)
- a tax-free contribution, like a personal undeducted contribution, for the purposes of fund and member income tax
- similar to a personal contribution but does not attract a super co-contribution
- reported only at the 'All contributions received for the current year' label on the member contributions statement (MCS) or rollover benefits statement (if the amounts are rolled out of your fund before 30 June).
There is one exception in relation to the last point, above: if the FHSA transfer was under a family law obligation, the amount is reported at both the 'Spouse and child contributions amount' and 'All contributions received' labels on the MCS. We ensure the contribution is counted against the member's non-concessional contributions cap by referring to reporting given to us by FHSA providers.
Conditions for accepting FHSA contributions
In most cases you can choose to accept FHSA transfers just as you can any other member contributions. In addition, the contributions standards permit acceptance of FHSA contributions for members older than 65 years and younger than 70 years.
Accepting FHSA transfers will benefit your members and allow them to consolidate their super with you. Super account holders have indicated that they prefer to transfer the account balance held in their closed FHSA to their usual super fund rather than be placed in a situation where they are required to establish new accounts with other super funds.
The limited circumstances in which you cannot accept FHSA contributions are similar to the circumstances in which other member contributions must be rejected. They include:
- the member is 70 years of age or more
- the member has not provided a tax file number to your super fund (either on the transfer form or previously)
- the member for whom the contribution is intended cannot be adequately identified (for example, the details of the account holder on the form do not match the membership details held by you)
- the account holder is no longer a member of the super fund or the super fund can no longer accept contributions for the member because the member's account is in pension phase
- your super fund is prohibited from accepting certain contributions by its trust deed, governing rules or by state or federal legislation (for example, some defined benefits funds).
Returning FHSA payments
For payments of account balances received from FHSA providers, return the payment to the payee (the FHSA provider), together with the form that accompanied the payment, either:
- Super contribution from a first home saver account (NAT 72537), or
- Super contribution from a first home saver account under a family law obligation (NAT 72629).
You should provide the reason for the rejection of the payment as a notation on the form.
For payments of the FHSA government contribution received from us, you need to complete a payment variation advice and send it to us with the returned FHSA government contribution payment.
Sections within Reporting and administrative obligations
Last Modified: Thursday, 4 October 2012