First Home Super Saver Scheme (FHSSS): how to save your deposit in super

Super is taxed lighter than a savings account. Used right, FHSSS gets you to your deposit faster.

By ECTD Editorial · Published 2026-04-30 · Updated 2026-04-30

If you're saving for your first home, the deposit is the slow part. The First Home Super Saver Scheme (FHSSS) lets you build part of that deposit inside super, where your money is taxed lighter than it is in an ordinary savings account. Used properly, it can leave you thousands better off and get you to the deposit line faster. Used carelessly, it has timing traps that can lock money up or trigger tax you didn't expect. Here's exactly how it works, with the numbers.

The basic idea: super as a tax-advantaged savings tin

The FHSSS is run by the ATO. It lets you make extra voluntary contributions into your super fund, then later withdraw most of those contributions plus a deemed earnings amount to put towards your first home deposit. The reason to bother is tax. Money you salary-sacrifice into super is taxed at 15% going in, instead of at your marginal income tax rate. For a lot of working Australians, that gap is the whole point.

Crucially, the scheme does not let you touch your existing super balance or your employer's compulsory contributions. You can only ever withdraw the extra voluntary amounts you've added specifically for this purpose, plus the associated earnings the ATO calculates. Think of it as a special, tax-favoured side pocket sitting next to your main super, not a raid on your retirement savings.

What you can put in, and what you can take out

Two limits trip people up because they don't match. There's a cap on how much counts per financial year, and a separate cap on how much you can ever release in total.

$15,000 per financial year of eligible voluntary contributions can count towards the scheme. Contribute more than that in a single year and the excess simply doesn't count towards FHSSS — it stays in super under the normal rules.
$50,000 total is the maximum amount of eligible contributions you can ever have released across all years. So you can build the full $50,000 over several years, but never faster than $15,000 per year of contributions counting.
On top of the contributions, the ATO adds a deemed earnings amount when you withdraw. You don't have to track your fund's actual returns — the ATO calculates it using a set rate, so the amount released is your eligible contributions plus that uplift.

Both concessional (before-tax, like salary sacrifice) and non-concessional (after-tax personal) contributions can count, but they're treated differently on the way out. The before-tax money is where the real tax win sits, so that's what most people prioritise.

Watch your concessional cap: FHSSS salary-sacrifice contributions still count towards your annual concessional contributions cap, which is $30,000 for 2025-26. That cap includes your employer's compulsory super as well. If your employer already puts in, say, $12,000, you only have about $18,000 of room left before you start hitting excess-contribution issues. Do the sum before you set up a salary sacrifice.

Who's eligible

The headline rules are straightforward, but the detail matters. To use the scheme you generally need to:

Be 18 or older when you request the release (you can make the contributions earlier, but you can't have the money paid out before 18).
Have never owned property in Australia — that includes an investment property, vacant land, a commercial property or an interest in a company-title dwelling, not just a home you lived in. There are limited financial-hardship exceptions.
Not have previously requested an FHSSS release. It's a once-only scheme.
Intend to live in the home you buy (or build) for at least six of the first 12 months you can. It's for owner-occupiers, not investors.

The eligibility test is applied per person, not per couple. That's good news: if you're buying with a partner and you both qualify, you can each run your own FHSSS and each release up to $50,000 of contributions, potentially putting up to $100,000 of contributions plus earnings towards the same purchase.

The tax saving, with real dollars

This is the part worth slowing down on, because it's where the scheme earns its keep. Take someone on a $90,000 salary. In 2025-26 that income sits in the 30% bracket (the rate that applies from $45,000 up to $135,000), so they're paying 30c tax on the next dollar they earn, plus the 2% Medicare levy on top — roughly 32c in the dollar at the margin.

Suppose they want to direct $15,000 towards their deposit this year. Two paths:

Ordinary savings account: they earn the $15,000, pay about 32% tax and Medicare on it, and roughly $10,200 lands in the bank. Any interest the account then earns is also taxed at their marginal rate.
Via FHSSS salary sacrifice: the $15,000 goes into super before income tax, and is taxed at just 15% on the way in — about $2,250 — leaving $12,750 working towards the deposit. That's roughly $2,550 more in the pot from the same gross pay, before earnings.

It doesn't stay quite that lopsided, because the money isn't tax-free coming out. When the concessional portion is released, it's taxed at your marginal rate minus a 30% tax offset. For someone in the 30% bracket the offset largely cancels the tax on withdrawal, so the bulk of that 15%-versus-32% gap survives all the way through. The higher your income, the bigger the upfront saving — and the more the 30% offset matters at the back end.

The win is the tax gap, not the returns: People often ask whether super will 'beat the market' over the year or two they're saving. Wrong question. The FHSSS advantage is mostly the tax difference on contributions, locked in the moment the money goes in at 15%. You're not betting on investment performance — you're skipping a chunk of income tax. That's why it can work even over a short saving window.

How you actually apply: the myGov and ATO steps

The mechanics confuse people because the contributions and the withdrawal are separate jobs, done at different times, and the ATO sits in the middle — your super fund never pays the money straight to you.

Make the contributions. Either arrange salary sacrifice with your employer (before-tax) or make personal contributions to your fund. If you make personal contributions and want them treated as before-tax, you must lodge a valid 'notice of intent to claim a deduction' with your fund and get their acknowledgement — miss this and they're treated as after-tax.
Wait until you're ready to buy. Don't request the release until you actually intend to sign a contract, because the clock starts once the money is paid to you (more on that below).
Request a determination, then a release, through myGov. Log in to myGov, go to the linked ATO service, and request an FHSSS determination. This tells you your maximum releasable amount. You then request the release.
The ATO instructs your fund. Your super fund pays the money to the ATO, the ATO withholds any tax due and sends the balance to your bank account, usually within a few weeks.
Buy or build within the time limit. Once the money hits your account you generally have 12 months (the ATO can extend by a further 12) to sign a contract to buy or build.

The timing traps that catch people out

This is where good intentions turn into a tax bill or locked-up cash. The scheme is unforgiving about sequence.

Releasing too early. Don't pull the money out 'to be ready' months before you're house-hunting. Once it's released and you don't sign a contract within the allowed window, you generally have two choices: recontribute the assessable amount back into super (and tell the ATO), or keep it and cop FHSSS tax of 20% on the assessable portion. Either way it's friction you created by jumping early.

Requesting the determination after you've already signed. The scheme is designed for you to request your release before you sign a contract to buy or build, or very shortly after. Sign first and sit on it, and you can find the timing rules work against you. Sort the FHSSS request out around the same time you're getting serious, not after settlement.

Assuming the money is liquid for the auction. An FHSSS release is not instant. There's a determination, then a release request, then your fund paying the ATO, then the ATO paying you — it can take weeks. Do not count on FHSSS cash being available for a deposit cheque you have to write next Saturday. Build the lead time in.

Forgetting the notice of intent. If you make personal contributions and never lodge (and have acknowledged) the notice of intent to claim them as a deduction, they're treated as after-tax money — and you lose much of the tax advantage that made the exercise worthwhile.

It pairs with other first-home help: FHSSS is about building the deposit tax-efficiently. It sits alongside other government support such as the First Home Guarantee (which lets eligible buyers purchase with a smaller deposit without lenders mortgage insurance) and any current state or territory stamp duty concessions and first home owner grants. Check the rules that apply in your state, as thresholds and concessions differ and change. Using FHSSS does not disqualify you from these — they solve different parts of the same problem.

Is it worth it for you?

FHSSS tends to make most sense when several things are true: you genuinely have never owned property, you're a year or more away from buying so the money has time to sit, you're paying a decent marginal tax rate (the 30% bracket and above is where the gap really bites), and you have room left under your $30,000 concessional cap after your employer's contributions. It's less compelling if you're on a very low income near the tax-free threshold (the 15% contributions tax could be close to or above your marginal rate), or if you need the cash to be available at short notice.

A sensible play for many couples buying together: each person salary-sacrifices up to their available cap each year, lets the contributions accumulate towards the $50,000-each ceiling, and then both request releases through myGov in the lead-up to going to auction. Run your own numbers against your actual salary, your employer's super, and your buying timeline before you set anything up — the brackets and the concessional cap are the two figures that decide how much room you really have.

General advice warning: This article is general information only and does not take into account your personal circumstances, objectives or financial situation. It is not personal financial, superannuation, tax or legal advice. FHSSS rules, contribution caps and tax thresholds change and have eligibility conditions — confirm the current details with the ATO and consider seeking advice from a licensed financial adviser, registered tax agent or your super fund before acting.

General information only — not personal financial, tax, legal or medical advice. Consider your own situation and consult a licensed professional before acting. Figures are current as at the date shown above.