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Tax for Australians for Dummies, 2014 - 15 Edition by Jimmy B. Prince

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Part V

Thinking Long-Term

tip.tif Five Things to Keep in Mind About Tax and Retirement

  • Complying superannuation funds pay a 15 per cent rate of tax from its investment activities. If you run a SMSF and break the rules, the Tax Office may treat your fund as a non-complying super fund, which means you become liable to pay a 47 per cent rate of tax.
  • You can set up a SMSF to help fund your retirement, but you need to satisfy a number of strict conditions. For example, you can’t access your benefits until you satisfy a condition of release, such as when you reach your preservation age and retire.
  • Special rules apply if you make a contribution to a complying superannuation fund. Provided you satisfy certain conditions, you can make a concessional contribution that qualifies for a tax deduction and/or a non-concessional contribution that doesn’t qualify for a tax deduction.
  • If you’re 60 years of age and you receive a pension from a complying superannuation fund, the pension is ordinarily exempt from tax and excluded from your assessable income. It therefore pays to plan ahead and contribute as much as you can afford to your nominated complying super fund.
  • Under the CGT provisions, death doesn’t constitute a disposal of your CGT assets, but your beneficiaries may be liable to pay CGT on their subsequent disposal. The amount of tax payable depends on whether the CGT assets were acquired before ...

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