Smart super strategies for this EOFY 2017/18
1. Add to your super – and claim a tax deduction
This financial year, there are new rules about who can claim a deduction for personal (after tax) contributions to super.
In the past, you could only claim the deduction if you earned less than 10% of your income from employment. But from 1 July 2017, deductions for personal contributions can also be claimed by employees.
2. Get more from your salary or a bonus
If you’re an employee, you may be able to arrange for your employer to direct some of your pre-tax salary or a bonus into your super as a ‘salary sacrifice’ contribution.
Again, you’ll potentially pay less tax on this money than if you received it as take-home pay – generally 15% for those earning under $250,000 pa, compared with up to 47% (including Medicare Levy).
3. Convert your savings into super savings
Another way to invest more in your super is with some of your after-tax income or savings, by making a personal non-concessional contribution.
Although these contributions don’t reduce your taxable income for the year, you can still benefit from the low tax rate of up to 15% that’s paid in super on investment earnings. This tax rate may be lower than what you’d pay if you held the money in other investments outside super.
4. Get a super top-up from the Government
If you earn less than $51,813 in the 2017/18 financial year, and at least 10% is from your job or a business, you may want to consider making an after-tax super contribution. If you do, the Government may make a co-contribution of up to $500 into your super account.
5. Boost your spouse’s super and reduce your tax
If your spouse is not working or earns a low income, you may want to consider making an after-tax contribution into their super account. This strategy could potentially benefit you both: your spouse’s super account gets a boost, and you may qualify for a tax offset of up to $54.
If you would like any information on any of the above, please don't hesitate to contact us.
COCO Accounting & Financial
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Luke Crockford of Crockford Investments Pty Ltd ATF Crockford Family Trust ABN 32 904 298 603, trading as COCO Accounting & Financial, is an authorised representative of Meritum Financial Group Pty Ltd, Australian Financial Services Licensee.
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