Tax Aware Strategies

Investment returns and investment costs are the two main factors that investors and in many cases, financial advisers focus on.

But, another critical factor that is often overlooked is the impact of tax.

Nothing is more certain in life than death and taxes! Tax is a “cost” that should always be considered because the tax impost can be particularly devastating; often representing the single largest cost an investor pays. But please note – we are not helping anyone “avoid” tax. Our team, with the back-up of our DFK Everalls colleagues will simply be looking to ensure that you don’t pay any more tax than you legally have to.

Tax aware investing includes strategies designed to legally minimise the tax impact of investment decisions.

We do this by providing both tax effective strategies and investment recommendations.

A tax aware approach joins the dots and reduces the impact of tax by proactively managing and minimising tax through a range of strategies. In many cases, these strategies can also help to lower transaction costs.

The reward for investors is higher after-tax returns without the need to take on additional risk. The tax savings compound over time helping you to reach your financial goals sooner.

We will tailor recommendations for your particular circumstances and will consider:

  • Whose name investments should be purchased in because that then determines what tax rate might be applicable to both the ongoing income and the capital gain on sale. The options could include you or your partner’s name; jointly; via your super fund or perhaps via a Family Trust or Investment Company.
  • Whether a Self-Managed Super Fund is right for you – In some cases, holding your superannuation inside a SMSF can provide access to more tax effective strategies than Public Super Funds can offer.
  • Investment options that minimise the tax applied to investment returns, leaving you more money to grow. Our investment recommendations will consider things like:
    • How much income versus capital gain a particular investment is likely to make and when; and
    • How much of that income and capital gain will be taxable and when. (This can take into account eligibility for franking credits; or particular types of investments that aren’t taxable until a future point in time);
    • Estate planning issues to ensure that tax consequences of inheritances are minimised eg by making sure superannuation is paid out to the most appropriate beneficiary; or by using Testamentary Trusts to provide for beneficiaries particularly if they are under 18.
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