Tax Planning

METHODS OF REDUCING TAX LIABILITY


The objective of any tax planning arrangement is to reduce the tax payable in respect of a given quantity of profits or earnings, including profits on the realisation of assets within the CGT regime. In broad terms, there are several different ways of reducing liability to tax. These are summarised below.

Aim                                                                          Possible methods

Reduce assessable income                           Derive capital, not income 
                                                                  Avoid deriving assessable amounts 
                                                                  Select best CGT option for calculating gain 
                                                                  Maximise CGT cost base 
                                                                  Income exemptions

Increase deductions and offsets                   Maximise present deductions and concessions 
                                                                  Deductions for individuals 
                                                                  Deductions for businesses


     
Reduce rate of tax/defer payment of tax        Maximise offsets 
                                                                   Use withholding tax provisions
                                                                   Averaging for primary producers 
                                                                   Averaging for authors, performers,

                                                                   inventors, sportspersons, etc 
                                                                   Delay derivation of income

 

Divert income                                               Alienate income to another 
                                                                   Transfer income-producing assets 
                                                                   Contract with associated taxpayers 
                                                                   Use discretionary distributions 
                                                                   Commercial considerations

 

Select tax planning “vehicle”                         Family members 
                                                                   Family partnerships 
                                                                   Family companies 
                                                                   Family trusts 
                                                                   Loss companies 
                                                                   Unit trusts 
                                                                   Loss trusts 
                                                                   Tax haven vehicles

Avoid unforeseen problems                           Partnership restructuring 
                                                                   Business sales 
                                                                   CGT issues


These strategies may conflict in a particular case. For example, a high income earner may be desirable as a holder of a negatively geared property from an income tax perspective, but would be undesirable from a CGT perspective if that property was expected to increase significantly in value. Thus, it is necessary to balance different tax considerations. Non-tax issues must also be considered, eg the high income earner may be an undesirable owner of an asset if that person is a professional who may be subject to a negligence action.


Superannuation- Borrowing for Superannuation

Superannuation is most important in keeping up our standards of living, particularly in advanced age and retirement. There are excellent tax concessions opportunities and we must make the most of them, otherwise our standard of living will suffer. We do not know how much longer the Government will be paying such generous pensions making self reliance very important.... Read more


Share Trading

It is always a wise investment to invest in the market in blue chip shares across various sectors to reduce your risk.

Share trading under prudent professional training can and will accelerate overall gains in a flat or declining market.... Read more

 

January 2010

Maximise Your Refund And Get What You're Entitled!

At Funder & Associates we provide a comprehensive preparation of your tax return and lodgment.

Our lodgment service not only takes the hassle out of preparing your tax return, but also:

Your lodgement is logged in our system, generally in date order and attended to quickly to ensure a speedy turnaround. However we pride ourselves on our professionalism, therefore we do not have a same day service of completion and lodgement.  Our business is based on a long term relationship with each client that covers all aspects of the client's financial affairs, not just the lodgement of tax returns as important as that may be. 

The system lodges each return electronically and clients are notified immediately of their assessments.

Our systems are accurate, reliable, efficient, flexible and fast!