Too often investors undertake tax planning as the financial year is about to finish. This is often akin to closing the tax door after the investment horse has already bolted. Tax planning is best done as part of a detailed financial plan taking account of all of your investments and liabilities, sources of income and living expenses, and the investment and retirement goals. If you are one of the rare people that have a tax problem this year, or want to avoid one occurring in June, there is an important tax fact you should be aware of. It relates to when a capital gain is made. Under tax law a capital gain is not made when the sale proceeds are …

There are many options on how you own investments, if you make the wrong choice it can have a huge effect on how much after tax income is produced. Many people invest in their own name without a full appreciation of the tax consequences. Of even more concern are those that choose to invest through a company without a thought of the disastrous capital gains tax effect. The first options involve the investment going into either an individual’s or in joint names as a couple. If borrowings are involved, such as with margin lending or the negative gearing of a property, the investment should go in the name of the person with the highest taxable income. By doing this the …

Prior to the current capital gains tax regime tax was only paid on the sale of assets that had been bought with the intention of selling them at a profit. Under this rule the scales were tipped heavily in favour of taxpayers. When the new capital gains tax system was introduced on September 20, 1985 the laws became more complicated, and the scales swung back in favour of the ATO. Q. Up to 1974 two of my great Aunts jointly owned and lived in a house in inner city Perth. In 1974 one Aunt died and left me her half share in the house. The other Auntie continued to live in the house until 1989 and then moved to an …