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Client Alert for August 2013
Wright Partners • Aug 14, 2013
Specific tax rule to prevent dividend washing
Individual denied interest deduction
Overseas doctor a tax resident of Australia
Partnership denied GST credits
Division 7A benchmark interest rate
Reasonable travel and meal allowance amounts
Car depreciation limit
Key superannuation changes
Excess concessional contributions
TIP: These proposed changes will undoubtedly be welcomed by the 40,000-odd taxpayers who are expected to pay (on average) $1,100 less tax on their excess concessional contributions in 2013-2014.
However, taxpayers on the top marginal tax rate are expected to have a slightly higher tax liability for their excess concessional contributions (due to the additional interest charge).
However, taxpayers on the top marginal tax rate are expected to have a slightly higher tax liability for their excess concessional contributions (due to the additional interest charge).
Higher contributions cap of $35,000
TIP: Eligibility for the higher cap depends on a person's age on 30 June in the previous income year. This means:
- persons who were aged 59 years or over on 30 June 2013 are eligible for the higher cap in 2013-2014; and
- persons who will be aged 49 years or over on 30 June 2014 will eligible for the higher cap in 2014-2015.
Please contact our office if you wish to discuss your eligibility for the higher cap.
- persons who were aged 59 years or over on 30 June 2013 are eligible for the higher cap in 2013-2014; and
- persons who will be aged 49 years or over on 30 June 2014 will eligible for the higher cap in 2014-2015.
Please contact our office if you wish to discuss your eligibility for the higher cap.
TIP: Taxpayers aged 59 years or over on 30 June 2013 should consider reviewing their salary-sacrificing arrangements, deductions for personal contributions and transition to retirement pensions to take into account the higher concessional cap of $35,000 for 2013-2014.
Extra 15% contributions tax for $300,000+ incomes
TIP: Individuals with incomes above $300,000 may want to consider limiting their concessional contributions to compulsory superannuation guarantee contributions (9.25% for 2013-2014) where such benefits can be packaged in a more tax-effective manner. Alternatively, these individuals may want to consider whether it is more beneficial to instead make after-tax non-concessional contributions.
