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Published 8 June 2017

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 wealth management. So we’ve outlined 12 tax-effective strategies that you may benefit from. We can help you find what strategies are right for you, so you can benefit now and also save your retirement.


For Individuals

Smart Superannuation Strategies

Six super strategies that may help reduce your tax liability whilst building your super savings for your retirement.[/slider]

If you… You may want to…  So you can…
1. Get more from your salary or bonus Are an employee. Sacrifice your pre-tax salary or bonus into super rather than receive it as cash. – reduce tax on your salary or bonus by up to 34{89774503f1dc5a8067a215bf11c503ad6eecdd9fbdfb7beae4875fba6258e357}
– take advantage of the contribution cap that applies in this financial year
2. Make tax deductible super contributions Earn less than 10{89774503f1dc5a8067a215bf11c503ad6eecdd9fbdfb7beae4875fba6258e357} of your income2 from eligible employment (e.g. you are self-employed or not employed). Invest in super by making concessional contributions. – claim your contribution as a tax deduction- take advantage of the contribution cap that applies in this financial year
 3. Make after-tax contributions
to super
Have an investment in your own name. Cash out the investment and use the money to make a personal after-tax super contribution1 – reduce tax on investment earnings by up to 34{89774503f1dc5a8067a215bf11c503ad6eecdd9fbdfb7beae4875fba6258e357}
– increase your retirement savings
5. Get a super top up from the Government Earn less than $51,0202 pa, of which at least 10{89774503f1dc5a8067a215bf11c503ad6eecdd9fbdfb7beae4875fba6258e357} is from employment or a business. Make a personal after-tax super contribution. – qualify for a Government co-contribution of up to $500
– increase your retirement savings
6. Boost your partner’s super and
reduce your tax
Have a spouse who earns less than $13,8002 pa. Make an after-tax super contribution on their behalf. – receive a tax offset of up to $540
– increase your spouse’s retirement savings

Smart Insurance Strategies

Two insurance strategies that may help you benefit from tax concessions this financial year.

If you… You may want to…  So you can…
1. Buy insurance in super tax-effectively – Are eligible to make salary sacrifice contributions, or
– Are eligible to receive Government co-contributions, or
– >Have a spouse who earns less than
$13,8002 pa, or
– Earn less than 10{89774503f1dc5a8067a215bf11c503ad6eecdd9fbdfb7beae4875fba6258e357} of your income2 from eligible employment
– Purchase life and total and permanent disability insurance through a super fund
– Make concessional contributions to your super fund
– Benefit from tax concessions
– Make premiums more affordable
2. Pre-pay income protection premiums and reduce this year’s tax Are employed or self-employed Pre-pay 12 months’ income protection insurance premiums – Claim your tax deduction upfront
– Pay less income tax this financial year

Smart Investment Strategies

Four investment strategies that may help you improve your tax liability this financial year.

If you… You may want to …  So you can …
1. Offset a capital loss against a capital gain Have received capital losses from your investments. Utilise the capital losses against any capital gains. – Manage your tax on investments more efficiently
2. Defer asset sales Are thinking of selling a profitable asset this financial year. Defer the sale until a future financial year. – Manage your cashflow more efficiently
3. Pre-pay investment loan  Have (or are considering establishing) a geared investment portfolio. Pre-pay 12 months’ interest on your investment loan. – Manage your cashflow more efficiently
– Potentially pay less income tax this financial year
4. Make better use of your tax refund Receive a tax refund. Use your refund to:
– Pay off non-deductable debts first
– Pay off your home loan and then borrow to invest
– Fund your daily living expenses and contribute your pre-tax salary into super
– Save on interest
– Invest your refund outside of super
– Boost your super tax effectively

Smart Super Reform Strategies

The May 2016 budget announced key superannuation (super) changes that have come under much scrutiny. With a few subsequent amendments, the Bill was put before parliament in late November and has now been passed. These new measures were designed to improve the sustainability, flexibility and integrity of Australia’s super system, most of which come into effect from 1 July 2017.

 1. Introducing a $1.6 million transfer balance cap Introducing a $1.6 million transfer balance cap which limits the amount that can be transferred to the retirement phase, where earnings are tax-free. This measure will also apply to death benefit income streams. Click here to read more.
2. Reducing the concessional contributions cap to $25,000 Reducing the concessional contributions cap to $25,000 for all taxpayers and introducing a concessional contributions catch-up regime for those with total super balances of less than $500,000. Click here to read more.
3. Reducing the non-concessional contribution cap to $100,000 pa Reducing the non-concessional contribution cap to $100,000 pa (or $300,000 under the bring forward provisions), limiting the ability to make NCCs to people who have a total superannuation balance of less than $1.6 million and introducing transitional rules for those who triggered the bring forward rule prior to 1 July 2017. Click here to read more.
4. Increasing income eligibility for the spouse contribution tax offset Increasing the annual income threshold from $10,800 to $37,000 for eligibility for the spouse contribution tax offset. Click here to read more.
5. Abolishing the anti-detriment payment.  An anti-detriment payment enables the refund of contributions tax paid during a fund member’s lifetime, which is then paid as a lump sum to certain dependent/s (spouse, former spouse, child including adult child) of a deceased fund member. From 1 July 2017, anti-detriment payments will no longer be able to be made. Click here to read more.
6. Removing tax exempt earnings for transition to retirement income streams A transition to retirement (TTR) pension allows you to reduce your working hours but not your lifestyle by using TTR pension payments to supplement your income. From 1 July 2017, tax exemptions on super fund earnings for transition to retirement pensions will be removed. Click here to read more.
7. Lowering the threshold for Division 293 tax to an annual income of $250,000. Division 293 reduces the tax concession on superannuation (super) contributions for individuals with an income greater than the limit in place. From 1 July 2017, this limit will decrease from $300,000 to $250,000. Click here to read more.

Fact Sheets

 Fact Sheet  Description
Super taxation thresholds for 2017/18 The ATO has released the super taxation thresholds and contribution caps that apply in the 2017/18 financial year.
Updated Centrelink and Aged Care fact sheets The following updated fact sheets take into account the revised rates and thresholds that apply from 20 March 2017:
Aged care – for residents who entered care before 1 July 2014
Aged care – for residents who entered care from 1 July 2014
Centrelink Fact Sheet
Contribute to super and offset capital gains tax When contributing to super, claiming a portion of the contribution as a tax deduction could enable you to pay less capital gains tax and increase your retirement savings.
Convert business capital into tax-free retirement benefits If you’re selling your business to retire, taking advantage of the CGT small business concessions could enable you to manage tax and get more money into super.
Convert your super into a tax-effective retirement income Starting an account based pension with your super when you retire could enable you to receive a tax effective income and make your savings last longer.
Make tax-deductible super contributions By making a personal super contribution and claiming the amount as a tax deduction, you may be able to pay less tax and invest more in super.
Make insurance more affordable It may be more affordable to take out life and total and permanent disability (TPD) insurance in a super fund rather than outside super.
Sacrifice pre-tax salary into super Contributing some of your pre-tax salary, wages or a bonus into super could help you to reduce your tax and invest more for your retirement.
Top up your income when cutting back work If you plan to scale back your working hours, starting a transition to retirement pension could help you to replace your reduced income.
Top-up your super with help from the Government If your income is under a certain threshold, then making personal after-tax super contributions could enable you to qualify for a Government co-contribution and take advantage of the low tax rate payable in super on investment earnings.

Some of these strategies are best implemented prior to the end of financial year, speak to an RJS Strategic Wealth Adviser today on 1300 27 28 29.

1 It’s important to check for CGT implications before cashing out any investments.
Includes assessable income reportable fringe benefits and reportable super contributions. Other eligibility conditions apply. 

This blog has been prepared by RJS Wealth Management Pty. Ltd. ABN 24 156 207 126. RJS Wealth Management Pty. Ltd. is a Corporate Authorised Representative (No. 438158) of Modoras Pty. Ltd. ABN 86 068 034 908 an Australian Financial Services and Credit Licensee (Number 233209). The information and opinions contained in this blog is general information only and is not intended to represent specific personal advice (Accounting, taxation, financial, insurance or credit). No individuals personal circumstances have been taken into consideration for the preparation of this material. Any individual making a decision to buy, sell or hold any particular financial product should make their own assessment taking into account their own particular circumstances. The information and opinions herein do not constitute any recommendation to purchase, sell or hold any particular financial product. Modoras Pty Ltd recommends that no financial product or financial service be acquired or disposed of or financial strategy adopted without you first obtaining professional personal financial advice suitable and appropriate to your own personal needs, objectives, goals and circumstances. Information, forecasts and opinions contained in this fact sheet can change without notice. Modoras Pty. Ltd. does not guarantee the accuracy of the information at any particular time. Although care has been exercised in compiling the information contained within, Modoras Pty. Ltd. does not warrant that the articles within are free from errors, inaccuracies or omissions. To the extent permissible by law, neither Modoras Pty. Ltd. nor its employees, representatives or agents (including associated and affiliated companies) accept liability for loss or damages incurred as a result of a person acting in reliance of this publication.