NSW Downsizer Conveyancing & Super Contribution
Australians aged 55+ can contribute up to $300,000 from the sale of their main residence into super. Combined with NSW conveyancing strategy, downsizers can transition tax-effectively into a smaller home with cash in super.
Quick Answer
NSW homeowners aged 55+ who sell their principal place of residence (held for 10+ years) can contribute up to $300,000 each ($600,000 per couple) from the sale proceeds into super under the Downsizer Contribution Scheme. The contribution does not count toward the concessional or non-concessional contribution caps and does not require the meeting of the work test or the $1.9m total super balance limit. The contribution must be made within 90 days of settlement using ATO Form NAT 75073. The home being sold must qualify for the main residence CGT exemption (full or partial). NSW stamp duty for the new home is paid as normal — there is currently no NSW-specific downsizer stamp duty concession (proposed but not enacted). Downsizers should also consider Centrelink Age Pension implications: the family home is exempt from the assets test, but cash from sale held outside super counts toward both income and assets tests.
The $300,000 downsizer super contribution
Introduced in 2018 and expanded over time (age threshold lowered to 55 in 2023), the downsizer contribution allows older Australians to top up their super using proceeds from selling their main residence. Key rules:
- You must be aged 55 or older at the time of the contribution.
- You must have owned your home (or your spouse must have) for at least 10 years immediately before the sale.
- The home must qualify (full or partial) for the main residence CGT exemption.
- You can contribute up to $300,000 (single) or $600,000 (couple — $300K each) from sale proceeds.
- The contribution must be made within 90 days of settlement.
- You must use ATO form NAT 75073 'Downsizer contribution into super'.
- Each person can use the downsizer contribution ONCE in their lifetime.
- The contribution does NOT count toward concessional ($30K) or non-concessional ($120K) caps.
- Total super balance limits ($1.9m) do NOT apply to downsizer contributions.
- You do NOT need to meet the work test or be employed.
Main residence CGT exemption
Selling your principal place of residence is generally CGT-free under Section 118-110 of the Income Tax Assessment Act 1997. To qualify:
- The dwelling must have been your main residence for the entire ownership period.
- The land must be 2 hectares or less (excess area is partially CGT-assessable).
- If you absented yourself from the home, the 6-year rule may apply (you can absent for up to 6 years and retain the exemption if no other property is your main residence).
- If you ran a business from home or rented out a room, partial CGT may apply on the income-producing portion.
- You can elect to treat ANY home as your main residence after a move — but only one property at a time qualifies.
NSW stamp duty for downsizers
NSW does not currently offer a stamp duty concession specifically for downsizers (a NSW Treasurer's proposal was floated in 2024 but not legislated). Downsizers pay full standard NSW transfer duty on the new property — typically:
- Property up to $1m — around $40,090 duty.
- Property $1m–$1.5m — around $62,590 duty.
- Property $1.5m–$2m — around $85,090 duty.
- First home buyer exemption is NOT available to downsizers (only first-time buyers).
- Off-the-plan deferral (12-month duty deferral) IS available if the new home will be your principal place of residence — useful for downsizers buying into newly-built smaller apartments.
Centrelink Age Pension impact
Downsizers receiving the Age Pension or Commonwealth Seniors Health Card need to be aware:
- Your principal place of residence is EXEMPT from Centrelink assets test.
- Cash sitting in a bank account from the sale counts toward both assets test and deemed income.
- Super in accumulation phase counts toward assets test if you're aged 67+ (or whatever the current Age Pension age is).
- Super in pension phase (account-based pension) counts toward both tests.
- If you sell and don't buy a new home for 12+ months, the proceeds become assessable.
- Always speak to a financial planner before downsizing if Age Pension is material to your retirement income.
Downsizer Strategy Comparison
How three NSW downsizer scenarios compare on tax and Centrelink outcomes (illustrative).
| Scenario | Sale Net Proceeds | Downsizer to Super | Pension Impact |
|---|---|---|---|
| Couple sells $2m home, buys $1.2m unit | $800,000 | $600,000 ($300K each) | Reduced (cash + super) |
| Single sells $1.5m home, buys $900K unit | $600,000 | $300,000 | Reduced |
| Couple sells $1.2m home, buys $900K unit | $300,000 | $300,000 (one person) | Minor reduction |
| Single sells $800K home, buys $600K unit | $200,000 | $200,000 | Minor reduction |
Indicative only. Always obtain financial planning advice before downsizing. Pension impact assumes existing assessable assets are at threshold.
How NSW Downsizers Sell, Buy, and Contribute to Super
Speak to a financial planner first
Model the downsizer contribution, Age Pension impact, and tax outcomes BEFORE listing your home. The decision is rarely just about money.
Engage a NSW conveyancer to sell
Conveyancer prepares the contract for sale, orders Section 10.7, sewer diagram, title search, and any strata documents.
Engage a NSW conveyancer for the purchase
Many downsizers move from a freehold home to a strata unit or villa. Strata conveyancing requires careful strata report review for sinking fund and special levies.
Time the sale and purchase
Ideally exchange and settle on the same day for both transactions. Bridge finance or deposit bonds can fill any gap. Discuss with your conveyancer.
Settle via PEXA on both transactions
Sale and purchase settle via PEXA. Net cash from sale is available immediately on settlement (usually within 1–2 hours).
Lodge downsizer contribution within 90 days
Use ATO form NAT 75073. Contribute to your super fund (must accept downsizer contributions — most major funds do). Aged 55+ requirement met as at contribution date.
Notify Centrelink
Update Centrelink with new home address and any cash holdings within 14 days of settlement to avoid pension overpayment recovery.
Frequently Asked Questions
Common NSW questions answered by Elyment Conveyancing — written for buyers, sellers, and investors.
Australians aged 55+ can contribute up to $300,000 each from the sale of their main residence into super, in addition to normal contribution caps. Used once in a lifetime. Must be contributed within 90 days of settlement.
55 or older at the time of contribution. The age was lowered from 60 to 55 in 2023. There is no upper age limit — even people aged 80+ can use it.
No. Despite the name, you don't need to actually 'downsize'. You can sell, contribute to super, and buy a similar or even larger home — or no new home at all (e.g. move into rental or aged care).
Yes — each spouse aged 55+ can contribute up to $300,000, for a couple total of $600,000. The home must qualify for one or both spouses' main residence CGT exemption.
Your home is exempt from the assets test while you live in it. Sale proceeds (cash) count toward both assets and income tests. Contributing to super removes the cash from immediate test if you're under Age Pension age, but assets in super count once you reach Age Pension age.
Generally no, if your home was your main residence for the entire ownership period and is on land of 2 hectares or less. If you absented yourself or rented out part of the home, partial CGT may apply.
Currently no specific NSW downsizer stamp duty concession (a 2024 NSW Treasurer proposal was not legislated). Downsizers pay full standard transfer duty on the new home, but can use the 12-month off-the-plan deferral if buying off-the-plan.
Generally no. The home must be owned by the individual (or spouse). Properties held by family trusts, companies, or SMSFs do not qualify for the downsizer contribution.
Related NSW Guides & Tools
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