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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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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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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This strategy involves employee’s salary sacrificing $1,000 of wages income (which is taxable) for $1,000 of employer provided goods or services (which is tax free). The goods or services provided by the employer must be same ones as they sell to their customers. So a clothing retailer for example, could provide $1,000 of free clothing…
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Work-related counselling provided to employees (and their associates) in order to improve or maintain their efficiency at work or prepare them for retirement will be tax deductible and FBT exempt. It can be provided as individual or group counselling and can be related to matters such as: Quit smoking programs. Weight watches programs to lose…
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Long service awards granted in recognition of 15 years or more service are tax deductible and FBT exempt, provided the value of the award doesn’t exceed the following specified amounts: $1,000 for 15 years’ service. Plus $100 per additional year of service. Where the value of an award exceeds the relevant maximum value, no part…
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"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"
- Bono: U2