There are a lot of people asking what to do if they pay the top marginal tax rate.
1. do you and your partner have health insurance?
If not, your tax rate is 1% higher due to the medicare surcharge. On $100k a year, thats $1000. Surely you can get health cover for less than this and reap the benefits health cover provides, while saving tax $$$ at the same time.
2. consider salary sacrafice to increase your super.
Instead of paying 47%, you pay 15% on any additional super contributions.
3. ownership of income streams.
if you have an asset like a PI earning extra income, which is in the name of the highest earner, consider changing legal title over to the lower earner. this will lower the tax paid out of this income. there may be some CGT issues.
4. interest offset.
if you have a home loan, and also have a term deposit or some other investment paying interest, consider an interest offset account. interest paid in a mortgage is not tax deductable, but interest gained from an investment is taxable. if you offset these two amounts, your tax can be lowered.
5. consider a change in structure.
a trust is an effective way of lowering your tax liability.
If you want lots of free holidays around Australia each year, buy IP’s all over the place. You get to claim travel expenses and accommadation so you can inspect each property twice a year. Hmmmm Cairns sounds nice, so does WhitSundays…….
The topic ‘high tax bracket savings’ is closed to new replies.
