Knowledge Centre

Seeds of Growth

Dividend imputation’s magical effect for Australian stocks

What a dreadful thing is the dividend-imputation tax system, if you believe its critics. They allege the abolition in 1987 of the double taxation of company earnings paid out to individuals forces investors to own too many shares, reduces the tax take and shrinks the amount of money companies have to invest.

Senior couple getting advice

Welcome to the April edition of e-Insight. This month we cover:

  • New Social Security rates and thresholds from 20 March 2015
  • New aged care fees and thresholds from 20 March 2015
  • Centrelink confirm application of account based income stream ‘grandfathering’
  • ATO videos for SMSF clients
  • ASIC Register of financial advisers
  • Review of retail life insurance advice
  • Taxation discussion paper

Article 1

Review of Australia’s Welfare System

The Government has released the final report of the review of Australia’s welfare system – A New System for Better Employment and Social Outcomes. The report provides a comprehensive analysis of the existing welfare system and delivers a set of recommendations to simplify the system with a focus on getting people into work.

Senior couple getting advice

ATO issues further guidance on SMSF related party LRBAs

In this edition of e-Insight, we discuss two recent ATO Interpretative Decisions and the implications for related party lending to fund limited recourse borrowing arrangements (LRBAs). Where the terms of the loan (taken together) and the ongoing operation of the loan are not consistent with an arm’s length lender, the ATO is likely to determine that the arrangement gives rise to non-arm’s length income (NALI).

Seeds of Growth

The mighty US dollar – its benefits and potential drawbacks

 In 1985, the finance ministers of France, Japan, the UK, the US and West Germany met at the Plaza Hotel in New York and agreed to the Plaza Accord.

Their concern? An overvalued US dollar, which had nearly doubled on a trade-weighted basis over the preceding five years, largely because the Federal Reserve had raised the cash rate to quell inflation.

Article 1

Account based pension deeming rules from 1 January 2015

If you start a new account based pension from 1 January 2015, then deeming applies on the account balance for the Centrelink income test. This means new account based pensions are assessed in a similar way to bank accounts, term deposits and managed funds.

Seeds of Growth

Germany’s policy stance is failing the Eurozone

Germany’s political leadership in a sense has already saved the euro; so far, anyway. European Central Bank President Mario Draghi would never have come up with a lender-of-last resort scheme to backstop the currency without the assent of German Chancellor Angela Merkel.

Article 1

ASFA Retirement Standard

The ASFA Retirement Standard benchmarks the annual budget needed by retirees to live comfortably or modestly in retirement. The figures are compiled by the Association of Superannuation Funds of Australia (ASFA) and released quarterly.
Assuming you own your home outright and are of good health, ASFA calculates the annual budget you’ll need in retirement is (September quarter, 2014):

Senior couple getting advice

Deeming of account based income streams

From 1 January 2015, the social security deeming rules applying to financial investments will apply to:
• Account based income streams (account based pensions and annuities) with a commencement date of 1 January 2015 or later, OR

Welcome to our quarterly magazine – in this edition:

  • Being single can be costly
  • Managing your own super involves unique responsibilities
  • Your financial life post-divorce
  • New models for investment in the wake of the GFC
  • Immerse yourself in Victoria’s regional riches
  • Risk insurance – end of year review

We hope that you have enjoyed reading our newsletters this year.