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Published on June 6, 2019. Published by RJS Wealth Management Pty Ltd.

With the end of the financial year approaching, it’s a great time to make smart decisions about your finances. Taking action before 30 June can open up more opportunities for you. We know that there isn’t a one-size-fits-all solution to accounting, wealth management and business growth. So we’ve outlined some tax-effective strategies that you may benefit from. We can help you find what strategies are right for you and/or your business.

Superannuation Tax Tips

tax advantages

The tax advantages of saving in super

Saving more in super can come with tax and other benefits this financial year – but that’s just the start.
Once money is invested in super, earnings are taxed at a maximum rate of 15{89774503f1dc5a8067a215bf11c503ad6eecdd9fbdfb7beae4875fba6258e357} – instead of your marginal tax rate, which may be up to 47{89774503f1dc5a8067a215bf11c503ad6eecdd9fbdfb7beae4875fba6258e357}* including Medicare levy.
This low tax rate can help build up savings for retirement

Strategy 1

Consider adding to super and get a tax deduction.
This may be right for those who… are self employed or earn taxable income from other sources (such as investments).
Make an after-tax super contribution and claim a tax deduction.

What are the benefits?

  • Pay less income tax
  • Increased retirement savings

 

Strategy 2

Get more from your salary or bonus and minimize tax payable.
This may be right for those who are an employee.
Contribute pre-tax salary or a bonus into super, as part of a salary sacrifice agreement.

What are the benefits?

  • Pay less income tax
  • Increased retirement savings

 

Strategy 3

Convert savings into super savings.
This may be right for those who have money outside super.
Use this strategy by making an after-tax super contribution.

What are the benefits?

  • Pay less income tax
  • Increased retirement savings

 

Strategy 4

Get a super top-up from the Government.
This may be right for those who earn less than $52,697 pa.
Use this strategy by making an after-tax super contribution.

What are the benefits?

  • Receive a Government co-contribution of up to $500
  • Increased retirement savings

 

Strategy 5

Boost the spouses super and reduce tax.
This may be right for those whose spouse earns less than $40,000 pa.
Use this strategy by making an after-tax super contribution into the spouses super account.

What are the benefits?

  • Receive a tax offset of up to $540
  • Increase the spouses retirement savings

 

Tips and traps

Before adding to super, keep in mind money will be inaccessible until certain conditions are met.
There are caps on how much can be contributed to super each year.
It’s important to take the caps into account as penalties may apply of exceeded.
Make sure any contributions are received before June 30.
With electronic transfers (including BPAY) the contribution takes effect the day the super fund receives the money, not the day of transfer.

Getting advice

Getting advice

Other eligibility criteria and conditions apply in relation to these strategies.
Talk to a Modoras planner to help decide which strategies are most appropriate.