Family Tax & SMSF

Why do we need to discuss family tax and what is it?

In most cases, we merely discuss individuals’ circumstances about their tax returns. However, some items such as the Medicare levy and the Medicare levy surcharge are highly close to the total assessable income of your family. The Medicare levy is 2% of your taxable income, in addition to the tax you pay on your taxable income. You may get a reduction or exemption from paying the Medicare levy, depending on your and your spouse’s circumstances. If your whole family income is greater than income for MLS purposes, without joining proper private health insurance, you need to Medicare levy surcharge.

This is just one simple example of your whole family tax circumstances.

Family Trust

With more investment products coming to the market, some families start to face how to share profit or earnings from the investment market. Therefore, more and more people gradually shift their focus to another complicated business structure—family trust. Broadly speaking, a trust itself does not have to pay income tax. Generally, if the trust distributes net income to beneficiaries, the money is taxed in the hands of the beneficiary. Of course, more details should be considered when we talk about the tax of family trust.

Benefits Of Self-Managed Super Fund (SMSF)

Like all super funds, SMSFs benefit from concessional tax rates. In the accumulation phase, tax on investment income is capped at 15%; in the pension phase there is no tax payable, not even capital gains tax. Carefully considered tax strategies which can help you grow your super savings and reduce tax payments as you transition to retirement.