Unlock Early Retirement Dreams: Leverage the Downsizer Contribution for You and Your Spouse!


Introduction Dreaming of an early retirement and going on a grand European adventure? Selling your home and downsizing might get you there sooner rather than later.  If you’re 55 or over, a downsizer contribution to your superannuation could free up funds, without impacting your contribution caps. Let’s delve into it, especially focusing on the implications for spouses and former spouses.

Eligibility Criteria Before daydreaming about sipping wine in France, ensure you meet the essential criteria. Your home, whether in your name, your spouse’s, or a combination, should have been owned for a minimum of 10 years. And remember, it’s the sale value, not the market value, determining the maximum contribution amount.

Contribution Limits and Timing Each eligible individual can contribute up to $300,000, or the total sale value if it’s lesser, allowing a couple to collectively contribute up to $600,000. Be vigilant! The contribution must be made within 90 days of the settlement date. Missed the window? You might be granted an extension by the Commissioner of Taxation, but a compelling reason is a must!

Involvement of Spouse/Former Spouse Whether married, divorced, or anywhere in-between, the downsizer contribution can be a game-changer. Each party can independently make a contribution, fostering financial autonomy and security. This equal opportunity is great, especially for former spouses, enabling both to benefit equitably from the sale of the family home.

Contribution Splitting Craft your strategy! Whether $250,000 each or $300,000 for one and $200,000 for the other, understanding how to split contributions can be pivotal. For example, selling an $800,000 home for $500,000? The maximum combined contribution is capped at $500,000.

Property and Ownership Nuances The property must be in Australia and cannot be a houseboat, van, or mobile home. Eligibility for a full or partial Capital Gains Tax (CGT) resident exemption is also a requisite, indicating the property has been your residence at some point. And, the 10-year ownership rule applies even if the property is part of an estate after a spouse’s demise.

Downsizing and making the most of the contribution can set you on the path to realising your retirement dreams. Stay informed, plan wisely, and consider the implications for both current and former partners. Here’s to unlocking new adventures and ensuring a secure future.


Ready to turn your dreams into reality? Explore more about downsizer contributions and how they can reshape your financial landscape. Keep abreast of the rules, strategise with your spouse or former spouse, and set sail towards a fulfilling retirement.  Write us an email or give us a call today so we can customise this for you.