The process of taxing your super is simple
IT is my understanding that when contributions go into your super account, insurance premiums are taken out, then the 15 per cent contribution tax is taken out on balance. I hope what I have written makes sense. Is this true?
The contributions tax is assessed by making concessional contributions taxable income of the fund.
Then, as the fund pays 15 per cent income tax on its income, the tax is automatically assessed. Insurance premiums are debited directly in the same way as account keeping fees are.
Franking credits in the fund’s income can reduce the impact of the 15 per cent contributions tax. CAN you please clarify at what stage the pensionable age is being increased?
From 1 July 2017, the qualifying age for the Age Pension will start to gradually increase by six months every two years until it reaches 67 in 2023. This change will affect people born after 1 July 1952 as they plan for their retirement. IN a recent column, you wrote “Don’t start looking for a home or investment property until you become educated about how and where to buy, and never start the offer process until you learn how to negotiate. You will make your first amount of money on what you save going in if you are a good negotiator.”
How and where do you acquire these skills?
It’s not easy. One of the hardest things about property education these days is that 90 per cent of the people offering it are really using the education process as a cover for spruiking – at the end of the day they are trying to involve you in a “system” whereby you become so entrenched in their process, so reliant on their advice, that you also unquestioningly then buy property which they have sourced or had built for you.
Where the person providing the advice and/or education also becomes involved in the transaction by sourcing or otherwise introducing you to people who source or sell property to you, there is no hope of independence in that advice and every chance that big dollars are changing hands through a back door.
Start with some good books by well-known, trusted experts, and when it comes to courses,
A company cannot be independent if they offer advice and the purchase of the asset at the same time
never undertake one which eventually leads to an offer of a property purchase.
The same goes for a company offering advice — they simply cannot be independent if they offer the advice and the purchase of the asset at the same time.
Decide the location where you intend to buy, become an expert on it, and keep in mind that success in property usually involves your finding a rundown property in a good location and adding value.
This will involve talking to local agents, going to open houses and auctions and acquiring as much knowledge as you can. This can be timeconsuming but the results will be worth it.