Tax Planning 2018 - Super, Trusts & Primary Producers
Superannuation & pending 1 July 2017 tax changes
Superannuation is not only a great wealth creation tool for the longer term, it’s also a great tax minimisation tool. I am a big advocate in maximising tax deductable super contributions each year. The cap for this financial year in all age groups is $25k.
Contribution splitting. Have an older partner who is over 55 but under 65 ? might be worth diverting or splitting concessional super contributions to your spouse so you can claim the immediate tax deduction and also provide for earlier access to the super funds.
Spouse superannuation tax offset. Although not a great benefit it does provide something. The spouse superannuation tax offset allows a contributing spouse to claim an 18% offset, worth up to $540, for contributions made to an eligible spouse’s superannuation account. From 1 July 2017, the income threshold for the eligible spouse lifted to $37,000 and phases out at $40,000 so if this fits the income distribution of a couple and you want to make additional Non concessional contributions to super from say an inheritance, why not use it. For this tax year the spouse cap is $10,800.
Non Concessional contributions cap changes from July 1 2017 dropped back to $100,000 from $180,000 in fiscal 2017. You can still use the 3 year bring forward non concessional contribution in fiscal 2018 of $300,000. Although not a tax minimisation strategy it is certainly an important wealth creation strategy. There are many conditions to this and you need to seek professional advice before making a non concessional contribution this year.
Discretionary Family Trusts
Have or intend on making a family trust election in fiscal 2018 and intend distributing dividends to family members? Ensure that resolutions are made by 30 June on who will receive what percentage of the trust distributions. We are providing resolution services in June so book in now if you require assistance.
Start contacting family members to determine who is in a position to receive distributions and have them agree on the amount, need help preparing a consent to receive a distribution ? Please ask.
Don’t forget fencing/water facilities for this fiscal year can be 100% claimed as a tax deduction if paid for before 30 June. Storage assets can be claimed over 3 years.
Taxable income below $100,000? Consider using the Farm Management Deposits (FMD) scheme. Great for income shifting between years to lower taxable income
If you would like to discuss further with a qualified adviser, feel free to book a consultation