Golden Rules Of Wealth – Noel Whittaker

Unmarried children under 18 pay tax of up to 66% on “unearned” income above $416 a year, so you may find yourself paying harsh penalty tax if the interest goes above $8 a week. The low income rebate may increase the tax free amount so it’s important to take expert advice before the investment is placed. The Taxation Commissioner will use his power to assess interest directly to the parent named as trustee if he believes the money is, in reality, owned by the parents and is only being placed in a trustee account to cut tax.

The result can be heavy penalties if the trustee is a high earner. Check your trustee bank accounts and change the trustee to the lowest earner if you believe the Tax Office could regard the money as your own. One of the main tests is control — if parents use the money as their own, the interest will almost certainly be regarded as assessable to them.

Money to be used for children’s education can be invested for high capital gain in growth units of split trusts in a low-income earning spouse’s name. This solves tax problems because the income is too low to cause a loss of the spouse rebate and no capital gains tax should be payable on cashing in because of the notional five-year averaging rule. Making Money Made Simple contains a whole chapter on children’s tax.

Buying in a company name Be wary of buying assets in the name of a company. The family home will not be free from capital gains tax if bought in the name of a company, but one of the other implications is just as serious. Buying assets in the name of a company could make you liable for a higher rate of capital gains tax. A company, controlled by Jack, a high-income individual, bought a property for $600 000 and sold it eight years later for a net $1 200 000.

Because the owner was a company, it was not eligible for the 50% discount that applies to assets that have been held for over a year. Therefore, CGT was a flat 30% of the $600 000 profit or $180 000.

First published in Australia in 1996 by Simon and Schuster This ebook edition published in 2017 by Noel Whittaker Holdings Pty Ltd Visit our website at www.noelwhittaker.com.au Reprinted February 1997 2nd Edition August 1998 3rd Edition October 2001 4th Edition November 2004 5th Edition April 2009 6th Edition February 2011 7th Edition June 2017 © Noel Whittaker Holdings Pty Ltd 2017 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the publisher.

National Library of Australia Cataloguing-in-Publication data: Whittaker, Noel, 1940– . Golden Rules of Wealth ISBN 978-0-9954199-8-8 (epub – ebook) 1. Finance/personal – Australia. 2. Investments – Australia. I. Title Cover design by Sharon Felschow Cartoons by Paul Lennon Typeset in Australia by dta studio, Brendale, Queensland, 4500 10 9 8 7 6 5 4 3 2 1 OceanofPDF.com This book is dedicated to all the people who have asked me questions on radio, by email and at seminars.

Thanks to you, I am now aware of what you need to know. My wish is that this book will help you to discover the answers to the other questions you will have to ask yourselves if you are going to be successful. The laws relating to taxation, social security benefits, and the investment and handling of money, are constantly changing and are often subject to departmental discretion. While every care has been taken to ensure the accuracy of the material contained herein at the time of publication neither the author nor the publisher will bear responsibility or liability for any action taken by any person, persons or organisation on the purported basis of information contained herein.

Without limiting the generality of the foregoing, no person, persons, or organisation should invest monies or take other action on reliance of the material contained herein but instead should satisfy themselves independently (whether by expert advice or otherwise) of the appropriateness of any such action. OceanofPDF.com I About the Author nternational bestselling author, finance and investment expert, radio broadcaster, newspaper columnist and public speaker, Noel Whittaker is one of the world’s foremost authorities on personal finance.

Noel reaches over seven million readers each week through his columns in major Australian newspapers, including The Sydney Morning Herald, Melbourne’s The Age, Perth’s The Sunday Times and Brisbane’s The Sunday Mail.

This is a short excerpt from the opening of “” by Unknown, quoted for review and introduction purposes. All rights belong to the copyright holders.

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