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    TaxKiln Australia
    TaxKiln

    First Home Buyer Schemes

    Federal and state schemes for 2025-26: the Australian Government 5% Deposit Scheme (no income caps from October 2025), First Home Super Saver Scheme ($50,000 cap), Help to Buy shared equity, state FHOGs and duty concessions by jurisdiction, eligibility traps, and a $650,000 new home comparison across all eight states and territories.

    Australian first home buyers can access multiple layers of federal and state support. The federal 5% Deposit Scheme (expanded from 1 October 2025 with no income caps and uncapped places for the standard stream) eliminates lenders mortgage insurance on as little as a 5% deposit. The First Home Super Saver Scheme allows up to $50,000 in voluntary super contributions to be withdrawn for a deposit, with a significant tax advantage over saving outside super. State-level support varies dramatically: SA offers no duty and a $15,000 grant with no value cap on new homes, while QLD and TAS both provide $30,000 grants (to 30 June 2026).

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    Australian Government 5% Deposit Scheme

    From 1 October 2025, the former Home Guarantee Scheme is rolled into the Australian Government 5% Deposit Scheme with expanded access. The government (via Housing Australia) guarantees up to 15% of property value (18% for single parents), eliminating lenders mortgage insurance. The standard first home buyer stream has no income caps and uncapped places from October 2025. Eligibility requires being 18+, an Australian citizen or permanent resident, buying residential property under regional price caps, living in the property as owner-occupier, and not having owned a home or land in Australia in the last 10 years.

    First Home Super Saver Scheme (FHSSS)

    The FHSSS allows you to save part of your deposit inside super and withdraw it for a home purchase under ITAA 1997 Division 313. Voluntary contributions of up to $15,000 per year and $50,000 total can be withdrawn. Concessional contributions are taxed at 15% in super versus your marginal rate (up to 47%), and on release the assessable amount is taxed at your marginal rate minus a 30% tax offset. This is the strictest scheme for previous ownership: you must never have owned property in Australia, including land, investment, or commercial property.

    Help to Buy (shared equity)

    The federal shared equity scheme, rolling out nationally from December 2025, allows the government to contribute up to 40% equity on a new home or 30% on an existing home. The buyer needs as little as a 2% deposit (no LMI due to the combined lower effective LVR). Income caps of approximately $100,000 (single) and $160,000 (couple) apply, along with regional property price caps. The buyer repays the government's equity share on sale or earlier.

    State and territory grants and duty concessions

    State-level support varies dramatically in both the size of grants and the generosity of stamp duty concessions. The comparison below captures the headline FHOG amount and duty position for a $650,000 new home in each jurisdiction.

    Eligibility traps and clawback risks

    The most common eligibility failures are previous property ownership and occupancy breaches. The FHSSS is the strictest (never owned any property in Australia). The 5% Deposit Scheme requires no ownership in the last 10 years. Most state FHOGs require no prior residential property ownership and no prior FHOG receipt. Occupancy requirements typically mandate living in the property for at least 6 continuous months within the first 12 months of settlement. Breaching occupancy triggers full clawback of grants and reassessment of stamp duty at standard rates, plus interest and penalties.

    Tax treatment of grants and withdrawals

    FHOG and similar cash grants are generally not assessable income. Stamp duty savings are not taxable income. FHSSS withdrawals have a specific tax treatment: concessional contributions are taxed at 15% in super, and on release the assessable FHSSS amount is taxed at your marginal rate minus a 30% tax offset. If a contract is not signed within 12 months of release (or an approved extension), you must re-contribute the amount to super or pay additional tax.

    Forward look: 2026-27 changes

    The expanded 5% Deposit Scheme settings (no income caps, higher price caps) continue as the new normal for 2026-27. Help to Buy will be operational at scale. The FHSSS $50,000 cap and $15,000 annual limit are unchanged. The 16% income tax bracket drops to 15% from 1 July 2026, slightly shifting the FHSSS tax arbitrage. QLD and TAS $30,000 grants are explicitly tagged to 30 June 2026 and may revert to $15,000. WA's 2026-27 Housing Taxation Package targets higher FHOG caps and duty-free thresholds.

    Statute references

    • ITAA 1997 Division 313 (First Home Super Saver Scheme provisions)
    • Housing Australia Act (Home Guarantee Scheme / 5% Deposit Scheme)
    • Help to Buy Act (shared equity scheme)
    • Revenue NSW (First Home Buyers Assistance Scheme duty concession)
    • State Revenue Office Victoria (FHB duty exemption and concession)
    • Queensland Revenue Office (FHOG and transfer duty concession)
    • WA Office of State Revenue (FHOR, off-the-plan concessions)
    • RevenueSA (FHOG and duty abolition for new homes)
    • State Revenue Office Tasmania (FHOG and duty exemption)
    • ACT Revenue Office (Home Buyer Concession Scheme)
    • NT Treasury (FHOG and Territory Home Owner Discount)

    Frequently asked questions

    Can I use the FHSSS and the 5% Deposit Scheme together?+
    Yes. The FHSSS provides tax-effective savings for your deposit, while the 5% Deposit Scheme eliminates lenders mortgage insurance. You withdraw your FHSSS amount to form part of your 5% deposit, then the government guarantee covers the remaining gap up to 20% LVR. The FHSSS has no property price cap (though the withdrawal is capped at $50,000), while the 5% Deposit Scheme has regional price caps.
    What happens if I have previously owned property?+
    Eligibility rules vary by scheme. The FHSSS is the strictest: you must never have owned property in Australia (including land, investment, or commercial property). The 5% Deposit Scheme requires that you have not owned a home or land in Australia in the last 10 years. State FHOGs typically require you to have never owned residential property in Australia and never received a FHOG. Any previous ownership usually disqualifies you from FHSSS and most state schemes.
    What occupancy requirements apply?+
    The FHSSS requires you to live in the property for at least 6 months within the first 12 months. Most state FHOGs and duty concessions require you to move in within a set period (often 12 months) and live in the property for at least 6 continuous months. The 5% Deposit Scheme requires owner-occupier use. Breaching occupancy requirements triggers clawback of grants and reassessment of duty at standard rates plus interest and penalties.
    Which state offers the most generous support for a $650,000 new home?+
    South Australia (no stamp duty plus $15,000 FHOG with no value cap), Tasmania ($30,000 FHOG plus full duty exemption under $750,000), and Queensland ($30,000 FHOG plus duty concession) are the most generous at $650,000. NSW provides full duty exemption (under $800,000) plus $10,000 FHOG for new homes. ACT provides significant or full duty relief if income-eligible under the HBCS but no large cash grant.

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