colonel

Nice tips Wayne...will be checking on this one !

JBJ14

Can even disperse to your kids at any age - $3000 tax free each (until they become employed, then you use their tax bracket)

One thing to be careful of, if you are dispersing to family members, they are legally entitled to the money. So get your accountant to do up a letter that they sign which says they are gifting the money back to you.

elice_in_oz

I am getting myself a tax accountant! I didn't know you could do that.

So, could my OH have given me up to $3000/year over the last 5 years I've spent at home looking after the kids? And thus reduced his taxes?

Actually, I'm not sure I want an answer now it's too late and I'm back at work next week

iamthecreaturefromuranus

Let me guess.. you have to be self employed to be able to do it?

lauralollipop

OOOH this has me intrigued now as some of the people at my hubbies work do this, but when my hubby asked about it, it was all a bit hush, hush, so we didn't know if it was something legal...... So if I don't work and my hubby does, he can give me and his child $3k a year each and therefore get $6k tax free exemption??? does he have to pay the money into a trust account lump sum? I have never seen it asked on a tax return form though?

laven

Meaning once you set up a family trust you can disperse money to non working family members tax free? Can you do that without family trust?

JBJ14

Nope ... only through a trust. But there are loads of rules to set up a trust, so no-one get too excited.

I have one though, works great. I give half my income to my non-working OH and $6k to my kids! Then there are nieces and nephews, inlaws, parents .....

Note it has to be a discretionary family trust

JBJ14

He can give you as much as he wants, the kids get $3k each while they're not working.

You have a bank account for the trust (for simplicity), all money goes in there, but you can take it out as you please. It's not until tax return time that the distrubution gets decided

JBJ14

Your trust will have an ABN, it doesn't work if you're just on salary / wages. But if your company is flexible, they may help out!

JBJ14

Ummmmmmm depending on the situation, he may have been able to give you as much as he likes. Only kids are limited to the $3k

Sorry

JBJ14

Also .... please check and get advice from your accountant, I'm not a tax accountant and am just sharing a possible opening :-)

elice_in_oz

I knew I wouldn't like the answer
Thanks though! Might still get a tax accountant on the case

Bermudashorts

Agree seems to be something for self employed to consider. Can't see how this would apply to the average employed person.

http://www.taxlawyers.com.au/Manuals/FamilyTrusts.aspx
http://www.cleardocs.com/extra-family-trust.html#1

laven

thanks.. so.. trust is a really good idea when your salary is really higher then 139k (or how much aus govt considers high income, lets say 139k)

Do I understand correctly if you earn , say , 277, with a family trust you can basically pay tax like not a high income earner whats the catch??))

BadgeIsBack

We were thinking of doing this. The amount I was going to disperse to the missus reflected an amount that wasn't taking the piss. It was something like 30k.

Real (one) point of doing this is to get below a tax bracket.