Income protection (IP) policy holders are already seeing increases of up to 100% on their premiums this year and a majority seeing increases above 20%. This is not the case with all insurers. Policy changes are imminent, an immediate review of your policies is necessary. Read more – Insurance Premium Increases May 2021.
The end of the financial year will soon be upon us, with 30 June 2021 just around the corner. The months of May and June are the time to review & analyse ways to reduce your 2021 taxes based on your current income & expenses from July last year until now. We recommend all our clients consider tax planning for their business & personal tax. Download our tax planning guide & federal budget update for more information.
The 2021-22 Federal Budget is a balancing act between a better than anticipated deficit ($106 bn), an impending election, and the need to invest in the long term.
It is also a human budget, with $17.7 billion dedicated to aged care, more money in the pockets of low-income earners, the COVID vaccine rollout, $2 billion for mental health, a women’s economic package including a childcare subsidy increase and funding to prevent violence, and a Royal Commission into defence and veteran suicide.
Access your downloadable guide here PrimeAdvisory Federal Budget Update 2021-22.
We note that this year’s budget did not include as many tax and investment initiatives. However, the key points are:
For You & Your Family
- Low and middle income tax offset extended
- Medicare levy low income threshold
- $250 self-education expense reduction removed
- Work test repealed for voluntary superannuation contributions
- Expanded access to ‘downsizer’ contributions from sale of family home
- SMSF residency tests relaxed
Business & Employers
- Temporary full expensing extension
- Temporary loss-carry back extension
- Employee share scheme simplification
- $450 per month threshold for super guarantee eligibility removed
- Tax residency rules for trusts and limited partnerships
- New avenue for small business to ‘pause’ ATO debt recovery
We’ll keep you up to date as the detail of these measures comes to hand. Happy reading!
Get in touch
The team at PrimeAdvisory are available to assist you to capitalise on any of the Budget measures or minimise your risk.
If you have any questions, please don’t hesitate to contact us on 02 9415 1511.
The end of the financial year will soon be upon us, with 30 June 2021 just around the corner. The months of May and June are the time to review & analyse ways to reduce your 2021 taxes based on your current income & expenses from July last year until now. We recommend all our clients consider tax planning for their business & personal tax. Download our tax planning guide for more information.
We get asked many times every week “should I repay debt or contribute to super with my excess funds?” The answer is of course very personal and many factors need to be considered when reviewing these two options.
These are a few things to consider when choosing either your super or your mortgage to invest additional funds.
- The time remaining on your loan. On a 30-year mortgage, savings in the early years will have a much larger impact than towards the end. You will benefit from having to pay less, longer. Equally, if you are investing for a long period time, the compounding benefits of investments mean extra capital invested early will have significant benefits over a long period of time.
- Your interest rate. You will want to take into account how much you would save in interest by further reducing your loan. Your interest rate is calculated daily. You can compare this saving to what your expected return is should you invest further in super?
- When you will need to access the funds. If you put money into your super it is restricted until you meet a condition of release. Alternatively, there are ways to access funds with a home loan through offset or redraw programs.
- Tax benefits. There are no tax benefits to paying off a home loan early but there could be by adding extra into your super.
Your future self will thank you for talking to a professional in the field and we are here to help you with all your borrowing needs. Speak to one of advisors if this is a question you face and want help resolving.