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Tax, wealth, super and the 2019 federal election

If, as pollsters predict, Labor wins the federal election, there could be big changes ahead for tax and wealth planning in Australia.

We’ve had lots of questions from concerned clients about Labor’s proposed changes to tax laws, franking credits and other matters should Bill Shorten lead a federal election victory later this year.

As an individual you could be affected by:

  • Losing franking credit refunds to your self-managed super fund or yourself
  • Paying higher capital gains tax
  • Losing tax benefits from negative gearing into investment property

As a business you could be affected by:

  • Changes to the laws for loans from companies (known as Div 7A)
  • Discretionary trusts (also known as family trusts) being taxed at 30% of their income

We’re not going to recommend who you vote for, but it’s important that you have an understanding of how these tax and other changes will affect you.

For the moment, we’re recommending to our clients a “wait and see” approach before taking any specific action on any of these proposals. An election needs to be won and then legislation needs to be passed before new laws take effect.

But there may be some opportunities that open up soon to restructure your tax and wealth affairs to give you some significant tax benefits.

Over the next few months, we plan to keep you informed.

If you have any questions about this, please contact us now.

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