If you realised a capital gain this year and your taxable income is greater than $18,200 then it is likely that you will be subject to capital gains tax.
To reduce the capital gain you may consider;
- Additional tax-deductible superannuation contribution to the maximum limit of $25,000. For example, if you are on a salary of say, $90,000 per annum it is likely that your employer has contributed 9.5% to your superannuation fund in this case $8,550. Therefore you could make an additional contribution of $16,450 being $25,000 less $8,550.
- If you are under age 67 and you have not been working you can make the maximum $25,000 contribution as a personal tax-deductible contribution.
- Unfortunately, if you are over 67 and you have not been working you are unable to make a tax-deductible contribution of up to $25,000.
- Is your current superannuation balance less than $500,000? If so, you may be eligible to make an additional tax-deductible superannuation contribution. Essentially, if you contributed less than $25,000 in the 2019 Financial Year and/or the 2020 Financial Year you can contribute the difference this year and claim a tax deduction for this component. The ATO refers to this as the ‘carried forward’ unused concessional contribution.
If you are curious about legally minimising the tax that you have to pay along with maximising your superannuation contributions. Contact Quinn Financial Planning today.
Should you have any questions with regard to Superannuation, please submit an online enquiry now or call Peter Quinn on +61 2 9580 9166. We also offer a FREE 45-minute consultation should you have other financial planning, taxation or superannuation issues you may wish to discuss.
The information in this document does not take into account your personal objectives, financial situation or needs, and so you should consider its appropriateness having regard to these factors before acting on it. It is important that your personal circumstances are taken into account before making any financial decision and it is recommended that you seek assistance from your financial adviser.