From 1st January 2018, a 60% CGT discount applies for Australian resident individual’s investing in qualifying affordable housing. This also applies if the individual invests via a managed investment trust. The conditions to access the 60% discount are: The housing must be provided to low to moderate income tenants. Rent must be charged at a…
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From 1st July 2017, managed investment trusts (MITs) are able to invest in affordable housing, allowing investors to receive a 60% CGT discount on any capital gains made. MIT’s will be able to acquire, construct or redevelop property subject to satisfying the following conditions: Qualifying housing must be provided to low to moderate income tenants.…
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A person aged 65 or over can make a non-concessional contribution into superannuation of up to $300,000 from the proceeds of selling their principal residence (if they have owned it for at least 10 years). This is available to both members of a couple for the same home. This strategy is available from 1st July…
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From 1st July 2017, taxpayers can contribute up to $15,000 per year in voluntary contributions (up to $30,000 in total), that can be withdrawn for a first home deposit. The contributions must be made into their superannuation account and be within an individual’s existing contribution caps. The contributions and earnings are both taxed in the…
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This strategy involves using the entertainment facility leasing provisions of the FBT Act to make owning and operating a boat or yacht as tax effective as possible. To achieve this, it should be structured as follows: Individual owns the boat or yacht. Individual leases the boat to the business entity on an exclusive basis for…
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If your business has a turnover greater than $2 million then to qualify for the small business CGT concessions (and potentially pay no tax on your business sale) you need to pass the $6 million net assets test. The net value of CGT assets includes assets owned by you, any entities ‘connected with’ you, any…
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This strategy involves employees with large employment income salary sacrificing part of their wages into excess concessional super contributions. The tax consequences of this are: The employer receives a tax deduction for the total super contributions made. The excess super contributions are included in the employees individual assessable income and taxed at marginal rates. The…
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The sole trader business structure involves the individual personally operating their business. The advantages of operating a business as a sole trader include: Simple and easy for clients to understand. Cheap to establish and dismantle (basically just need a business name, ABN, GST registration and business bank account). No extra tax return required to be…
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This strategy involves having a company’s ordinary shares owned by a family trust structure (instead of the individual directors). This applies irrespective of whether the company operates a business or holds investments. The advantages of this strategy include: Provides asset protection – If the directors personally go bankrupt then the company is protected as the…
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This strategy involves purchasing a loss-making business and taking ownership of the company structure (to access the accumulated tax losses). Clearly this is only going to make economic sense if the purchaser can restructure and improve the business to turn the current operating losses into ongoing profits. This strategy can be attractive for the following…
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