Tax has been on the tip of everyone’s tongue since Kerry Packer’s death late last year. His comments made to a Senate committee in 1991 that every Australian who isn’t minimising their tax needs to have their head read may have forced calls for tax reform, but they’ve also sparked some renewed interest in tax avoidance schemes. And there’s lots of money to be made out there.
So we were interested to find new tax minimisation website www.taxcuts.com.au, which urges every Australian to be like Kerry and cut their tax to as little as possible – for a fee, of course. Frank Calabrese, a fireman by trade, told Crikey his tax minimisation software was written by an “average person who got sick of the system,” and not financial advisers, not accountants – in fact no one with an MBA, BSC or anything like that in their name.
Crikey called the ATO to get their reaction to Frank’s little business, and find out how they feel about the new push for Aussies to dodge their tax – legally of course – but hadn’t heard back at the time of publication. In the meantime, here are some of Frank’s best ways to avoid the tax man:
1. Superannuation Salary Sacrificing: By salary sacrificing compulsory or extra contributions you decrease your taxable income. Salary Sacrifice yourself down to a lower Tax bracket.
2. Salary Sacrificing General: Other than superannuation, a large variety of items can be salary sacrificed. Things you may never have thought of.
3. Benevolent Institutions: Employees of benevolent institutions can salary sacrifice a variety of items, the best being home mortgage repayments, pay off your mortgage while you pay less tax.
4. Gearing: Get a tax deduction for the interest you pay on the loan. Buy shares or managed funds that pay a fully franked dividend and you get more tax breaks.
5. Capital Gains: If you hold an investment for longer than a year, when you sell it you’ll get a 50% tax break on the capital gain. If you have reduced your income into a lower bracket you’ll pay less tax on the capital gain.
6. Working Partners: Salary sacrifice as much as possible or gear into an investment and increase the amount of Childcare Benefit and Family Assistance you might be entitled to.