Double dip for super

In the last post I mentioned you can generally claim a tax deduction of up $25,000 for super contributions paid in the year (increasing from 1 July 2021 tax year to $27,500)

However, if you have a self-managed superfund (SMSF), you could potentially get a tax deduction for super paid of up to $52,500 in one year. i.e. using the contribution cap of two years in one year.

This amount is made up of $25,000 cap for the current year and $27,500 for next year. You will need to allocate the second contribution to a holding account in the financials of your SMSF.

This strategy is known as a โ€œContributions Reservingโ€ strategy.

Be careful with this strategy and be sure to get appropriate advice from a financial planner and your business accountant.

๐“๐ˆ๐ ๐Ž๐… ๐“๐‡๐„ ๐ƒ๐€๐˜: For those who may have a large taxable income this year (large bonus or property sale) and are expecting a lower taxable income next year you should consider a contribution allocation strategy to maximise deductions for the current financial year.

Like any tax advice make sure you get help for your specific situation.

If you are a business owner and you are overwhelmed this tax time, Iโ€™ve got your back!

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