Taxation - Your thoughts.

[BigJon]

Richest Australians facing tax probe (http://news.ninemsn.com.au/article.aspx?id=384620)

I think this article is a little unclear.

It uses the terms tax avoidance and tax evasion interchangeably. As far as I am aware, tax avoidance is legal(tax minimisation, everyone should do it), tax evasion is illegal.

[CraigE]

My thoughts too, but having being targetted for so called tax avoidance which in fact was minimisation the ATO regard anything they do not get as avoidance or evasion. These buggers keep changing what is allowed and what is not and even when getting advice from them do not take it as right as I got burnt.
:(

[cartm58]

Tax minimisation is legal

Tax evasion Tax Avoidance isn't

But its a fine line as to what you do to minimise your tax as to whether it remains legal or illegal.

For the PAYE employee the best form of tax minimisation is making vlountary salary sacrifice contributions to your superannuation as its only taxed at 15 cents in dollar, more of benefit for those at top end of tax scales those earning more than $75,000 a year as can mean reduction of up to 30 cents in dollar tax and means extra superannuation contribution is what would have disappeared in tax dollars. You can put up to $100,000 into own super per year if your 50 or more this year and if under 50 this year you can put up to $50,000

The other allowable superannuation contribution if your spouse isnt working is to make a superannuation contribution on her behalf, you get tax rebate of $540 for $3,000 and you can contribute up to $10,000 into her superannuation unfortunately not a salary sacrifice option

The other tax minimisation option is buying a laptop as its salary sacrifice and FBT free and you can buy one per year.

Paul Keating when treasurer killed off most other worthwhile salary packaging options when he brought in FBT

[BigJon]

I guess using different terms doesn't make much difference, it is what you actually do with your money that makes the difference.

I use an accountant who I am happy with. He knows what he is doing (I hope!) and I am happy to let him figure the details out.

[Tusker]

Richest Australians facing tax probe (http://news.ninemsn.com.au/article.aspx?id=384620)

I think this article is a little unclear.

It uses the terms tax avoidance and tax evasion interchangeably. As far as I am aware, tax avoidance is legal(tax minimisation, everyone should do it), tax evasion is illegal.

There's the usual interpretation, although the ATO used both terms in their press release

Tax Commissioners battle against tax evasion (http://www.ato.gov.au/content/00125277.htm)

The ATO doesn't refer to a "raid" either. The days of turning up with generators & photocopiers I thought had long gone. More unhelpful, simplistic reporting by the media methinks.

Regards
Max P

[BigJon]

. More unhelpful, simplistic repoprting by the media methinks.

Regards
Max P


Surely not :o:cool::p

[Tusker]

Some more details of this have come through the tech literature today.

The German tax evasion probe broke on 14 Febuary. It seems the home & office of the Chief Executive of Deutsche Bank were searched concerning $1m "investments" in Liechtenstein. He's resigned, & been released on bail.

The Aust connection is "bank-client data that may have been acquired by a former Liechtenstein bank employee now possibly in Australia" -dating back to possibly 2002.

There have been raids across Germany in the last week or so. The German equivalent of the US CIA is reported to have purchased a CD-Rom with hundreds of German clients of this bank. For millions of Euros.

If that's not enough, another Liechtenstein bank has paid millions of Euros in blackmail. 2325 Germans are caught up in that one.

We haven't heard the last of this.

Regards
Max P