Hey everyone, thanks for watching! I hope this video helped you better understand the types of taxes in retirement. Don't forget to grab your FREE 6-Step Superannuation Check at www.torowealth.com.au/6-step-super-check. It’s packed with actionable tips to optimise your superannuation.
I’d be retiring or working less in 8 years, and considering this financial recession, I’m deciding to begin taking up skilled trades. I’m curious to know best how people spilt their pay, how much of it goes into savings, spendings or investments, I earn about $140k per year but nothing to show for it yet.
You should contribute to your retirement diligently, or better still look into financial planning don’t come to TH-cam for advise, consult a financial firm about your situation
Very true, I find myself lucky enough exposed to money management at an early age. Worked full time when I was 19, purchased first home at 28, fast forward time…. I’m 57 now, got laid off March 2020 amidst lockdown, a blessing in disguise. At once I consulted an advisory to match me with subsequent investments, I’m only 15% short of $1m as of today.
This is huge, would love to grow my reserve regardless of the economy situation, my 401k has lost accrued since early 2019, at this point, I’m in need of guidance, can you point me?
He is very well known in the financial sector. He not only understands the intricacies of the stock market, retirement and real estate but also has insights into navigating the financial sector for potential gains.
Hi Chris Some great information. Thanks for sharing I always thought the Age Pension was received tax free; can you please re-confirm. What happens if you have no other income ? If it is taxed, I assume the 1st $18k is tax free, so could you make a (up to)$12k concessional contribution to super to eliminate tax ? If the pension is treated as income is the Medicare levy payable ? Any info appreciated Cheers
Thank you. No better explanation of super anywhere. Does a tax free account based pension need to be considered for the tax payable on other non-super income?
Yes/No/Maybe... Sell the property, invest the proceeds into super, and purchase a pension/lifetime annuity? No tax on pension income, and a portion of the purchase price is not counted towards the assets test (for potential AP eligibility)? Depends on your super balance, age, work status, CGT that would be realized selling the rental property etc. etc. So, the usual 'it depends -- get personal advice from a financial adviser or tax accountant' mantra. General advice/info is, well, general... ;) Alternatively, use the rental income to purchase shares (or another property) and use leverage so get negative gearing so end up with reduced taxable income and increased long term capital gains. Gift it to someone on a low tax bracket (eg. a non-working married daughter) who won't pay much income tax on the rental income. After 5 years the 'deprived asset' also won't count towards the AP asset test any longer -- so you could get some AP and the daughter get up to 18,200pa rent income tax free... Transfer the property into a family trust and distribute income in the most tax effective way. Donate the property to charity. Charge less rent (so have less net rental income) So many ways to "reduce tax on rental income in retirement" ;)
@@fredfred4086 Well technically no -- while the money obtained as a loan is tax free, the interest on the loan is only tax deductible if the loan was used to buy an investment that produces investment (taxable) income. You can't just take out a separate loan secured against an existing property and spend that loan proceeds, then claim the loan interest as a tax deduction against the rental property income (rent). Claiming the interest on a personal use loan as a tax deduction would get caught as tax avoidance if you ever got a tax audit and they asked to show what the purpose of the loan was, to determine if the interest on that loan was a legitimate tax deduction or not. You might as well say to ask the tenants to pay some of the rent as cash in hand and not declare it -- reducing tax via tax avoidance is easy, but illegal. Tax minimisation is a bit more complex.
You can contribute up to 30k (including employee contribution) Example - you earn 100k/yr plus super. your employer contributes 12k, and you can contribute 18k pre tax of your own money.
Up to TBC of course ;) Then remainder is stuck in accumulation phase where it still gets taxed at 15% (which isn't much better than the 16% rate on income between $18,200 and $45,000). And the 'income stream' could be SABP for a SMSF, or an annuity product (which might be of benefit if eligible for part or full SP). Probably is that simple for 95% of people, but financial advisors generally work for the other 5% who have more complex situations (or whatever part of the 95% who have simple situations but can't be bothered to learn enough to DIY their financial and tax planning).
Hey everyone, thanks for watching! I hope this video helped you better understand the types of taxes in retirement. Don't forget to grab your FREE 6-Step Superannuation Check at www.torowealth.com.au/6-step-super-check. It’s packed with actionable tips to optimise your superannuation.
Best Australian superannuation information on the web, bar none!
I’d be retiring or working less in 8 years, and considering this financial recession, I’m deciding to begin taking up skilled trades. I’m curious to know best how people spilt their pay, how much of it goes into savings, spendings or investments, I earn about $140k per year but nothing to show for it yet.
You should contribute to your retirement diligently, or better still look into financial planning don’t come to TH-cam for advise, consult a financial firm about your situation
Very true, I find myself lucky enough exposed to money management at an early age. Worked full time when I was 19, purchased first home at 28, fast forward time…. I’m 57 now, got laid off March 2020 amidst lockdown, a blessing in disguise. At once I consulted an advisory to match me with subsequent investments, I’m only 15% short of $1m as of today.
This is huge, would love to grow my reserve regardless of the economy situation, my 401k has lost accrued since early 2019, at this point, I’m in need of guidance, can you point me?
*JOSEPH NICK CAHILL*
He is very well known in the financial sector. He not only understands the intricacies of the stock market, retirement and real estate but also has insights into navigating the financial sector for potential gains.
Hi Chris
Some great information. Thanks for sharing
I always thought the Age Pension was received tax free; can you please re-confirm. What happens if you have no other income ? If it is taxed, I assume the 1st $18k is tax free, so could you make a (up to)$12k concessional contribution to super to eliminate tax ? If the pension is treated as income is the Medicare levy payable ?
Any info appreciated
Cheers
Is a TTR assessed on personal income? or household income?
Thank you
Thank you. No better explanation of super anywhere. Does a tax free account based pension need to be considered for the tax payable on other non-super income?
Tax tax tax tax tax. Great information but rather depressing
Is there any way to reduce tax on rental income in retirement.
Yes/No/Maybe... Sell the property, invest the proceeds into super, and purchase a pension/lifetime annuity? No tax on pension income, and a portion of the purchase price is not counted towards the assets test (for potential AP eligibility)? Depends on your super balance, age, work status, CGT that would be realized selling the rental property etc. etc. So, the usual 'it depends -- get personal advice from a financial adviser or tax accountant' mantra. General advice/info is, well, general... ;)
Alternatively, use the rental income to purchase shares (or another property) and use leverage so get negative gearing so end up with reduced taxable income and increased long term capital gains.
Gift it to someone on a low tax bracket (eg. a non-working married daughter) who won't pay much income tax on the rental income. After 5 years the 'deprived asset' also won't count towards the AP asset test any longer -- so you could get some AP and the daughter get up to 18,200pa rent income tax free...
Transfer the property into a family trust and distribute income in the most tax effective way.
Donate the property to charity.
Charge less rent (so have less net rental income)
So many ways to "reduce tax on rental income in retirement" ;)
Cash or deductions. Depending on your income, you can also keep an accumulation super account open and deposit into it at 15%
Take out a small loan against the property. The loan is tax free, to be used how you want, and the rent repays the loan and is tax deductible.
@@fredfred4086 Well technically no -- while the money obtained as a loan is tax free, the interest on the loan is only tax deductible if the loan was used to buy an investment that produces investment (taxable) income. You can't just take out a separate loan secured against an existing property and spend that loan proceeds, then claim the loan interest as a tax deduction against the rental property income (rent). Claiming the interest on a personal use loan as a tax deduction would get caught as tax avoidance if you ever got a tax audit and they asked to show what the purpose of the loan was, to determine if the interest on that loan was a legitimate tax deduction or not. You might as well say to ask the tenants to pay some of the rent as cash in hand and not declare it -- reducing tax via tax avoidance is easy, but illegal. Tax minimisation is a bit more complex.
I thought you could contribute 27,000 to super and pay only 15pc tax on the whole amount. Anyone clear on this ?
30 K as of this financial year
Correct 👍@@inovatas
@ thank you muchly.
$25 - $30k over the last five years. It has incrementally increased.
You can contribute up to 30k (including employee contribution)
Example - you earn 100k/yr plus super. your employer contributes 12k, and you can contribute 18k pre tax of your own money.
It’s quite simple just put it in a income stream and then all the other investments. Just keep it under 18,000 a year. 🤔
Up to TBC of course ;) Then remainder is stuck in accumulation phase where it still gets taxed at 15% (which isn't much better than the 16% rate on income between $18,200 and $45,000). And the 'income stream' could be SABP for a SMSF, or an annuity product (which might be of benefit if eligible for part or full SP). Probably is that simple for 95% of people, but financial advisors generally work for the other 5% who have more complex situations (or whatever part of the 95% who have simple situations but can't be bothered to learn enough to DIY their financial and tax planning).
@ if you put it in a pension fund, there is no tax
@@wealthelife all those acronyms. I’ve no idea what you have said.
Shame it costs over $5000 + to see these guys