How to Minimise Your Taxes
The goal of tax planning is to arrange your financial affairs so as to minimise your taxes. There are three basic ways to reduce your taxes, and each method might have several variations. You can reduce your income, increase your deductions, and take advantage of tax credits.
Four Tax Minimisation Strategies to Consider:
1. Make concessional super contributions up to the $25,000 per year limit to your super fund by salary sacrifice. This allows a tax deduction to be claimed and reduces the tax rate to 15%.
2. Make non-concessional contributions with the excess funds available of up to $100,000 per year or use the bring forward rule of $300,000 for the 3-year period.
3. You can invest some of the money from your bank account in non-super managed investments which will be eligible for imputation credits on dividends and subject to capital gains tax which is more lenient than income tax.
4. Investment loan interest costs, together with ongoing expenses, can normally be claimed as deductions against your taxable income.
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