First Home Owner Grant vs FHSS Scheme: Which Saves More?
Australia offers two major first home buyer incentives: the First Home Owner Grant (FHOG) and the First Home Super Saver (FHSS) Scheme. They work very differently — and the good news is you may be able to use both. Here's how they compare.
| FHOG (State Grant) | FHSS Scheme (Super) | |
|---|---|---|
| Benefit amount | $10,000 – $30,000 (varies by state) | Up to $50,000 (lifetime cap) |
| Property type | New homes only (most states) | Any first home |
| Tax advantage | Grant is not taxable | Concessional tax on contributions |
| Time required | Immediate (on settlement) | Minimum 1–4 years of saving |
| Can combine? | Yes, with FHSS | Yes, with FHOG |
First Home Owner Grant by State
The FHOG is a one-off payment from your state or territory government. The amount and eligibility rules vary:
Higher Grants
- QLD: $30,000 (new homes under $750k)
- WA: $10,000 (new homes under $750k)
- TAS: $30,000 (new homes under $600k)
Other States
- NSW: $10,000 (new homes under $600k)
- VIC: $10,000 (new homes under $750k)
- SA: $15,000 (new homes under $650k)
Key limitation: The FHOG applies to new homes only in most states. If you're buying an established property, the FHOG won't help — but the FHSS scheme will.
How the FHSS Scheme Works
The FHSS lets you save for your first home inside superannuation, taking advantage of the lower tax rate on super contributions:
- Contribute up to $15,000 per year in voluntary contributions (concessional or non-concessional)
- Lifetime cap of $50,000 across all years
- Concessional contributions are taxed at 15% in super (vs your marginal rate outside super)
- On withdrawal, amounts are taxed at your marginal rate minus a 30% offset
- Deemed earnings are added to your withdrawal at the shortfall interest charge rate
FHSS Tax Savings Example
For someone earning $90,000 (32.5% marginal rate + 2% Medicare levy) contributing $15,000/year for 3 years:
Saving in a Bank Account
$15,000 earned, taxed at 34.5%:
- After-tax savings: $9,825/year
- Over 3 years: ~$29,475
- Interest taxed at marginal rate
Saving via FHSS
$15,000 contributed, taxed at 15% in super:
- In super after tax: $12,750/year
- Over 3 years: ~$38,250
- Extra savings: ~$8,775
Using Both Together
You can absolutely use both the FHOG and FHSS together. Here's a combined strategy for a first home buyer in NSW purchasing a new home under $600k:
- FHSS: Save $15,000/year for 3 years = up to ~$38,000 after deemed earnings
- FHOG: $10,000 grant on settlement
- Combined boost: Up to ~$48,000 towards your deposit
- Plus: You may also qualify for stamp duty concessions as a first home buyer
Key Considerations
- FHSS processing time: Allow 15–25 business days for the ATO to process your FHSS release
- You must buy or build within 12 months of requesting the FHSS release (extensions available)
- FHOG applies on settlement — funds are usually directed to your lender or conveyancer
- Both require you to live in the property for a minimum period (typically 6–12 months)
Calculate your FHSS savings
See how much you could save by using the FHSS scheme compared to a regular bank account.
Open FHSS CalculatorFrequently Asked Questions
Can I use both the FHOG and FHSS scheme together?
Yes, you can use both. The First Home Owner Grant and the First Home Super Saver Scheme are separate programs with different eligibility criteria. The FHOG is a state government grant for new homes, while the FHSS is a federal scheme using your superannuation. Using both can significantly boost your deposit savings.
How much can I withdraw under the FHSS scheme?
You can withdraw up to $15,000 of voluntary contributions per financial year, with a lifetime cap of $50,000. This includes both concessional (before-tax) and non-concessional (after-tax) voluntary contributions. Investment earnings on these contributions are also released, calculated using a deemed rate of return.
What is the tax benefit of the FHSS scheme?
Concessional contributions to super are taxed at 15% instead of your marginal tax rate. When withdrawn under FHSS, amounts are taxed at your marginal rate minus a 30% offset. For someone on the 32.5% marginal rate, contributions are effectively taxed at just 2.5% on withdrawal — a significant saving compared to saving in a bank account.
Is the First Home Owner Grant available for existing properties?
In most states, the FHOG is only available for new homes — either newly built, off-the-plan, or substantially renovated properties. Some states have occasionally extended it to existing homes, but this is rare. Check your state revenue office for current eligibility rules.