Bona fide redundancy

[Pessimistic]

Got a payout of $40k and have found work since. The money helped out well with the mortgage
My wife and I net about $7000 per month. Should I be doing any tax planning before the end of the tax year ?
Is it worth seeing an accountant.

Only reason I say this is this happened to my wife also when the medicare surcharge came in and the redundancy tiped us over the edge

 

[Frodo]

There are special tax rules for bonafide redundancy, it should be split from your normal income and put in a seperate box on your group certificate. Tax rate 'was' nil, several years ago. I'm not sure what it is now.
Consider a family trust and income splitting.

 

[Frodo]

I looked at this quickly, it may help

http://www.ato.gov.au/content/downloads/nat2657.pdf

 

[Daniel28]

Originally posted by Pessimistic
Got a payout of $40k and have found work since. The money helped out well with the mortgage
My wife and I net about $7000 per month. Should I be doing any tax planning before the end of the tax year ?
Is it worth seeing an accountant.

Only reason I say this is this happened to my wife also when the medicare surcharge came in and the redundancy tiped us over the edge

Yes, i reccomend some thorough look into your tax planning. Are you an amatuer with taxes or do you know your stuff? if you are an amatuer then I beleive it would be worth you going and seeing an account about it, but i on the other hand could handle this myself. It all depends on the person really.

 

[Frodo]

Re: Re: Bona fide redundancy

Originally posted by Daniel28
Yes, i reccomend some thorough look into your tax planning. Are you an amatuer with taxes or do you know your stuff? if you are an amatuer then I beleive it would be worth you going and seeing an account about it, but i on the other hand could handle this myself. It all depends on the person really.

What do you think of his tax situation Daniel?

 

[afc9798]

Originally posted by Pessimistic
Got a payout of $40k and have found work since. The money helped out well with the mortgage
My wife and I net about $7000 per month. Should I be doing any tax planning before the end of the tax year ?
Is it worth seeing an accountant.

Only reason I say this is this happened to my wife also when the medicare surcharge came in and the redundancy tiped us over the edge

If you and your spouse are netting 7K a month (equivalent to 150K per annum gross), you should have been seeing an accountant years ago as you would have obviously been paying too much (47c in the dollar each, depending on how the income is split). I wouldn't be setting up a family trust as this scheme is now under heavy scrutiny by the ATO and there are other tax effective ways to minimise your taxation. The other thing you could do is tell the Government that they can keep taxing you at the full rate and give me a lower rate Seriously, see an accountant ASAP.

 

[Frodo]

Re: Re: Bona fide redundancy

Originally posted by afc9798
If you and your spouse are netting 7K a month (equivalent to 150K per annum gross),

Nope, only about $110K per annum gross. $105K paid at max 30% rate, balance 42%

 

[scooter600x]

Re: Re: Re: Bona fide redundancy

Originally posted by Frodo
Nope, only about $110K per annum gross. $105K paid at max 30% rate, balance 42%

I think he is including the $40K payout.


How long were you working for them?

There is a tax free portion of your redundancy. Without having the figures with me, it's about $5,600 plus $2,812 per year of service. If you worked for them for about 12 years you would pay no tax on the $40K at all.