MAA255 Lecture Notes - Lecture 6: Tax Rate, Tax Avoidance, Negative Gearing
15 Apr 2019
School
Department
Course
Professor
Document Summary
Financial planners should consider strategies to minimise their clients tax payable with a legal framework. Best interest duty requires all financial planners to act in the best interest of their clients. Taxation law is very complex so clients may be encouraged to seek advice of a tax adviser or an accountant to confirm the taxation implication of the advice given. Transfer of income from an individual at higher marginal tax rates to one at a lower marginal tax rates. Income from business activities can only be split. Income can be transferred through the transfer of assets or investments to individuals at low marginal rates. Some tax consequences that must be considered are: transfer of income to a child as unearned income, actual payment of income may be required, transfer of assets may give rise to cgt. An investment may provide income or capital growth or both. Investment preferences depend on client"s cash flow needs and investment time horizon.
