Im just trying to get a proper understanding of the LITO. So according to this 2010-2011 FY if you earn 30,000
then you get $1500 back from the government from the tax you paid. So in 2010-2011 FY, 30,000
is the ideal amount to negatively gear your income down to in order to get the best possible value foryour money in tax terms. Terry said something previously that you could earn 16,000 without paying any tax due
to the LITO and im just trying to understand it.
http://calculators.ato.gov.au/scripts/axos/AXOS.asp
Also why do you still get 1500 back even if your income is 20,000 or 10,000?
My understanding is that it applies as if the ATO is paying the first $1,500 of your tax bill – but only if you earn less than a certain amount which is about $30,000 from memory.
If you income exceeds this based amount then the rebate gradually decreases until it cuts out completely.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
30,000 is correct and according to this one you get $1500 in your claim if you earn anything under that amount (30K). As you earn over this amount it gradually reduces untill you earn 67,500 untill you get nothing back.
Do you have to put a separate applicaiton in to get the LITO or does the accountant know to do this automaticlaly with your tax return?The ATO would do it automatically.
Also I should point out you don't actually get any of the $1,500 back into your hands. It is just a reduction in tax.
Also there is a seniors tax rebate too.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thanks Terry
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