Personal Finance

Newcastle Herald

Thursday June 19, 2008

GR

Q

Our son receives a disability pension and has about $25,000 in his account. He works with his father and as remuneration we provide his day-to-day living expenses. How should we arrange his finances so he is OK when we die? He turns 40 this year. His three siblings are all prepared to look after him. He is an asset around the home. Very physically able and drives his own car. He is intellectually disabled. Should he have, or does he qualify for, superannuation?

A

As he is under 65 he can contribute to super and if he is receiving genuine wages for the work he does, which appears to be the case, he could also qualify for the super co-contribution provided he could pass the income test. I suggest you consult a solicitor about including a testamentary trust clause in your will to hold the assets when you die. You would also need to consider who you would choose as trustees when this happens because they will be the ones making the decisions.

Q

I have heard of the mature-age offset. Can you advise where I can find information regarding this. I tried the Australian Taxation Office site and apart from finding it rather challenging to actually locate, I found it hard to navigate.

A

Information regarding the Mature Age Workers Tax Offset (MAWTO) can be located on www.jobwise.gov.au, which is a government website for older workers. The easiest way to find the necessary information is to type "mawto" into the search box at the top right hand corner of the website and follow the prompts.

Q

My wife and I, aged 55, have both salary sacrificed all of our wages since the beginning of the financial year. We each receive about $14,000 per annum in private investment income with minimal debt. After selling a block of land we have a capital gain of $700,000. How much can we each contribute to our super in total and how much would be tax deductible?

A

You can contribute a total of $100,000 each as concessional (deductible) contributions, but these will include contributions from all sources. This means you will need to count what you have salary sacrificed.

If you've owned the block for more than a year you will be entitled to the 50 per cent discount which should reduce the taxable gain to $350,000 or $175,000 each.

Send your questions to noelwhit@gmail.

© 2008 Newcastle Herald

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