We've finally got the PPoR loan mostly under control and at 2.64% it's not hurting us. We're planning on switching to generating passive income now. My wife can't afford to work anymore (after childcare, car expenses etc she loses money) so her taxable income next year will be $0. I'm in the 39% tax bracket. We're planning for me to gift her money, about $50,000 and her open a SelfWealth account in her name to buy VAS. I'll make additional contributions as I can, again as gifts to her. Is that an OK plan? Should we be doing anything different?
Family trust is an option to consider. Depends on how much money and thinking long term. What happens when you retire and all the shares are in your wife’s name? When your kids hit 18 and have no income?
Thanks Trainee, I had looked at that but got a bit concerned about this: Discretionary trusts in the ATO spotlight Discretionary trusts in the ATO spotlight The ATO is also focusing on activities where trustees distribute trust income to beneficiaries paying low or no tax (including a non-working spouse or adult children studying at university) with the intent of reducing the tax liabilities of a primary income earner and other trust beneficiaries in higher tax brackets. That kind of sounded like what we were planning. But yes will definitely talk to an expert and consider family trust, thank you.
You would be missing out on tax deductions if you did that. reduce non-deductible debt and reborrow to onlend to the wife. Get some legal and tax advice though.
Terry! You must live here. Tax Tip 47: Spousal Loans as a Tax Strategy I swear you should have a paid site where you feed it your bank statements and tax notice and it tells you all your blunders. Thank you as always..
