Financial Planning

Ask our Advisors (July 2011)

Mortgage One - Monday, July 11, 2011

Deductions for Self Employed

Can someone who is self employed salary sacrifice into super and thus receive a deduction for superannuation contributions?

A person will often describe themself as self employed when in fact they are employed by a family company. This tax structure allows a self employed person to have an employer who can claim a 100% deduction for superannuation contributions

Self Funded Retire Super Deductions

I’m 62 and have been a self funded retire for the past 5 years, with an income derived from dividends and fixed interest of $80,000 per annum. Can I contribute to super and get a tax deduction on my taxable income? Is there a work test?

As you are under 65, you can make contributions to superannuation without passing the work test and as no employer is paying superannuation contributions for you. You are entitled to claim a tax deduction for the concessional contribution, which is limited to $50,000 a person aged 50 and over.

Super no threat to pension

My husband is 66 and currently on a pension. I am 61, a teacher and because of my reasonable income my husband’s pension has been reduced from $480 to $100 a fortnight. We own our own home, I have $400,000 in super my husband has $50,000 and he has a $150,000 inheritance in a term deposit. What is the most tax effective thing to do with the inheritance without it having an effect on his pension?

The means test won’t count your superannuation until you reach your pension age of 65 and your home will remain exempt while you are still living in it. The income test is diminishing your husband’s age pension. As your husband is over 65 he can contribute his inheritance into super provided he can meet the work test i.e. work for 40 hours within 30 days. This will allow for the term deposit income to no longer be assessed under the income test and this should allow for your husband’s pension to increase. If you have a question for one of our advisors email your question to m1fs@m1.com.au.

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