Hi Shalendra

The contribution rules are complicated & are to change again from 1 July 2022. You note they are above 67 years of age. I have assumed that they are under 75 years of age (although this is not relevant for the downsizer rules).

In terms of the downsizer contribution rules each member will be able to contribute $300,000 each if they follow the ATO requirements being (as per the ATO):

• “you are 65 years old or older at the time you make a downsizer contribution (there is no maximum age limit)

• your home was owned by you or your spouse for 10 years or more prior to the sale – the ownership period is generally calculated from the date of settlement of purchase to the date of settlement of sale

• your home is in Australia and is not a caravan, houseboat, or other mobile home

• the proceeds (capital gain or loss) from the sale of the home are either exempt or partially exempt from capital gains tax (CGT) under the main residence exemption, or would be entitled to such an exemption if the home was a CGT rather than a pre-CGT asset (acquired before 20 September 1985)

• you provide your super fund with the Downsizer contribution into super form (NAT 75073) either before or at the time of making your downsizer contribution

• you make your downsizer contribution within 90 days of receiving the proceeds of sale, which is usually at the date of settlement

• you have not previously made a downsizer contribution to your super from the sale of another home or from the part sale of your home.”

I note that from 1 July 2022 the age requirement of 65 years or older is being reduced to 60 years or older.

For the 2021/22 year a member aged 67 years of age and under 75 years of age will be able to make a contributions if they meet the "work test".

(I note if an individual is currently aged under age 67 there is no work test required to be able to make a contribution. (It was changed from 65 to 67 from 1 July 2020)).

If an individual is aged from 67 to 74 then they must meet the work test to be able to make or receive a contribution. The work test is working 40 hours for remuneration over a 30 day period at least once during the year.

As a result if your 67 year old member meets the work test then they will be able to make a non-concessional contribution of $110,000 if their total superannuation balance (TSB) was less than $1,700,000.

From 1 July 2022 individuals aged 67 to 74 years of age will no longer have to meet the work test to make member non-concessional contributions.

If an individual wants to make a member taxable contribution for those aged 67 – 74 they will need to continue to meet the work test.

From 1 July 2022 member’s aged under 75 (up from age 67) will have now have an option to contribute up to $330,000 over a 3 year period (depending on their Total Superannuation Balance (TSB)).

The TSB rule is as follows for 2021/22 onwards:

Total super balance NCC & bring forward $

< $1,480,000 $330,000 over 3 years

> $1,480,000 & < $1,590,000 $220,000 over 2 years

> $1,590,000 < $1,700,000 $110,000 over 1 years

> $1,700,000 $0 (nil)

Thanks

SMSF AAA