Manage your tax most effectively
At the wealth accumulation stage of life, many of Strategic Wealth’s clients enjoy successful careers with high-level positions in corporate organisations. Many are also small business or professional practice owners. Along with their well-earned success, our Australian-based clients earn higher-level incomes, which are subject to higher rates of tax levied under the Australian taxation system.
It is for these reasons that our clients are interested in managing their tax exposure using means allowable under the Australian legislation. There are many strategies that may be considered to reduce your tax liability, however it is important to understand all of the implications that may flow on from the decision to pursue a particular strategy. At Strategic Wealth, we believe that, while it is important to reduce taxation where feasible, it is more important that the strategy creates wealth over the desired investment timeframe.
Key Strategies
Key strategies that may be effective in managing your tax liabilities include pre tax (Concessional) and other associated contributions to superannuation, the use of gearing or leveraging into growth assets, salary packaging of cars or other employment benefits. The circumstances and objectives of each client are different, so we use powerful financial models to determine which strategy creates the maximum after tax outcome for clients. A final decision can then be made after considering other constraints or risks associated with each strategic option.
Personal Risk Insurance Impacts
When considering personal risk insurances, the ownership of the policy can have a significant impact on the after tax cost of the premiums. We can help you understand the right ownership structure for the various types of insurances available.
Retirement Approach
As you approach retirement, eligible employees over the age of 55 can use strategies including ‘Transition to Retirement’. This can be extremely effective in reducing your tax while continuing to work and build up superannuation benefits without changing your lifestyle. The strategy needs to be tailored to your specific circumstances and updated on an annual basis to ensure that you maximise the benefits available from this strategy.
Small Business Ownership
The ownership structure of a small business can have a significant impact on the taxation paid while the business is in operation and also when ultimately sold. We can work with your preferred taxation adviser, or facilitate the introduction to an expert adviser in this area, to ensure that your business structure is the right one for now and in the future.
Expatriates
Special taxation rules apply to expatriate clients depending upon your residency status and employer compensation package (if applicable). Further details on this area can be found under our Expatriates section.
Weighing the Risks
There are a range of investment products promoted by providers and other advisers for their tax effectiveness. These products include numerous agricultural style investments in tree plantations, wineries, olives and emus. We suggest that extreme caution be taken when considering such investments to ensure that reward outweighs the significant risk associated. We believe other strategies can offer superior wealth creation outcomes at lower levels of risk.
