Can I use my KiwiSaver for a first home in Australia?

Can KiwiSaver's own first home withdrawal be used?

Not for a home in Australia. Clause 8 of the KiwiSaver scheme rules allows a first home withdrawal "for the purchase of an estate in land located in New Zealand". A house in Brisbane is not one, however long you have been a member.

Then what is the route?

Through Australian super, in two steps.

First, the transfer. Once you have permanently emigrated to Australia, the whole KiwiSaver balance can move into an Australian fund, if both providers take part. It has to be a fund regulated by APRA, never a self managed one, and the transfer is not taxed.

Second, the First Home Super Saver scheme, which lets a first home buyer take some voluntary contributions back out of super. The ATO's guidance note on it, GN 2024/1, says amounts transferred from a KiwiSaver scheme into a complying Australian fund "are eligible to be released under the FHSS scheme". The ATO's page on contributions sets out how: "An eligible KiwiSaver amount must be included in your FHSS determination request as a single personal voluntary (after tax) contribution, with details of the date it was credited to your Australian super fund account."

How much of it counts?

Up to A$15,000.

The law caps what the scheme can release at A$15,000 of the contributions made in any one financial year, and a KiwiSaver transfer counts in full in the year it reaches your fund. "You can't split this contribution over different financial years." The ATO's own example is Mei, who moves A$18,000 from KiwiSaver into her Australian fund in June 2024. The scheme treats it as one contribution in 2023-24, and only A$15,000 of it counts.

Two more things about that A$15,000. Any other voluntary contributions you make in the same financial year share it, counted in the order they were made, so salary sacrificed earlier in that year comes first. And the scheme pays out the contributions with an amount for earnings on top, which the ATO works out at a rate set by law rather than from what your fund actually earned.

The rest of the transfer stays where it is. To reach the New Zealand sourced part of an Australian fund, the ATO says, "you will need to reach the New Zealand age of retirement (currently 65)".

What does not count?

Money that has crossed the Tasman before. GN 2024/1 leaves out Australian sourced amounts, which started in Australian super and went to KiwiSaver before coming back, and returning New Zealand sourced amounts, which have been into Australian super once, gone back to KiwiSaver, and are crossing again.

A transfer large enough to take you over your non-concessional contributions cap loses the part over it too. The note: "Contributions that exceed your contributions caps are not eligible to be released under the FHSS scheme."

Who can use the scheme?

GN 2024/1 sets three tests: age, not having used the scheme before, and property. You must be at least 18, and you "must have never held a relevant property interest in Australia", which takes in investment and commercial property and vacant land, unless the ATO decides you lost it through financial hardship.

The test is property in Australia. The note lists what that includes, down to Norfolk Island and Christmas Island, and property in New Zealand is not on it.

You do not have to be a citizen or a permanent resident. The note says you are not required to be an Australian citizen, an Australian resident for migration purposes, or an Australian resident for tax purposes, though someone who is not a tax resident "may pay income tax on amounts released under the FHSS scheme at a higher rate".

Each person is tested on their own. In one of the ATO's examples, a partner who has owned a home in Melbourne cannot use the scheme, and the partner who never has can.

Is what comes out taxed?

The KiwiSaver money itself is not. It counts as a personal after-tax contribution, and the note is plain: "You do not pay further income tax on released amounts that consist of non-concessional contributions." The amount for earnings is taxed, at your marginal rate plus the Medicare levy, less a 30% offset, and the ATO withholds an estimate of that before paying you.

In what order?

The scheme has deadlines, and the order matters. From GN 2024/1, for a determination made on or after 15 September 2024:

1. The transfer reaches your Australian fund.
2. You ask the ATO, through myGov, for an FHSS determination, which states the most you can have released. You have to meet the tests on the day you ask, so it comes before any Australian property is registered in your name.
3. You ask for the release, normally within 60 days of the determination. The ATO says payment usually takes 15 to 20 business days.
4. You sign a contract to buy or build a home in Australia, at any point from 90 days before the release request to 12 months after it, intending to live in it for at least 6 of the first 12 months.
5. You tell the ATO within 90 days of signing.

If no home follows, you can put the money back into super, or keep it and pay an extra FHSS tax of 20% of the taxable part. The note also asks you to check with your fund first that it will release the money, what it charges, and whether any insurance on the account changes.

What this guide does not tell you

It does not tell you whether to move your KiwiSaver, or whether this is the right way to build a deposit. That turns on fees, insurance inside each fund, what else the money could do, and when you plan to buy, which are questions for a licensed adviser who knows your circumstances.

It leaves out the scheme's other contributions beyond how they share the yearly limit, and the scheme's overall limit across all years, which a KiwiSaver transfer on its own never reaches. It does not cover state first home grants, stamp duty concessions or other government help for first home buyers, which have rules of their own. And whether you can buy an established home at all as a New Zealander depends on your visa and whether you have moved yet.