MY MONEY RELATIONSHIPS
property if you separate, Carey says
it is more tax effective to “equalise”
your retirement savings rather
than having them concentrated
with the higher earner. “You’re
trying to get as much as you
can up to $1.6 million in a tax-
free pension for retirement, a
certain amount in your own
names outside super that you
won’t pay tax on because you’re
below the tax-free thresholds, and
super in the accumulation stage,
which is taxed at 15%,” he says.
Inevitably, if one spouse isearning
more,thiswillinvolvetoppingupthelower
earner’ssuperthroughstrategiessuchas:
- Spouse contributions, where you can claim a maximum
taxoffsetof $540bycontributing$3000to yourspouse’s
accountif theyearnlessthan$37,000. - The super co-contribution, where eligible fund mem-
bersreceiveupto $500fromthegovernmentif theymake
a personalcontributionof$1000. - Splitting your super contributions with your spouse.
Carey says you can direct up to 85% of your concessional
super contributions to your spouse each year. He says
this is not counted towards your spouse’s concessional
contributionscap(it’sstillcountedtowardsyours),sothey
cancontributea further$25,000if theyhavetheincome. - Concessional contributions. From this year, if your
account balance is less than $500,000, you can carry
forward any unused concessional contributions from last
year on top of the standard $25,000 contribution. Those
unused amounts will be available for up to five years.
As concessional contributions are taxed at 15% in super,
this won’t be tax effective for those on low incomes, but
Giaouris says if you have made a big capital gain, or your
spousehasa short-termhigherincome,youcanusethis
totopuptheirsupertaxeffectively. - Non-concessional contributions. Carey says you can
make after-tax contributions of up to $100,000 a year,
or up to $300,000 for the next three years under the
“bring-forward” rule, to your spouse’s super (the amount
depends on the account balance). He says if you have
non-preserved benefits in your own fund or are over 60
and meet a condition of release (such as changing jobs)
you may also be able to withdraw money from your own
fund to contribute to your spouse’s. As the money in
her fund is now untaxed, he says this can have estate
planning benefits and potentially protect your spouse if
there are further changes to super taxes. M
FOURMUST-HAVECONVERSATIONS
- Whatareyourfinancialgoalsasa couple?
- What is your current financial situation? What
are your income, expenses, assets, debts and credit
rating?Wheredoyouseeopportunitiestoreduce
debtandsaveforyourgoals? - What are your attitudes to spending and saving?
Understanding how your partner views money
willmakeit easiertoforma financialplanthat
suitsyouboth. - Who will handle the finances? Will one partner
take control overall? Will you split areas of respon-
sibility? Or will you make joint decisions? Make sure
you’re both happy with the decision and understand
what is happening.
SOURCE: Moneysmart.gov.au
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