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Salary sacrifice - contribute to cash or shares?

I'm new

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Replies 1

Hi, 

 

At the moment I'm salary sacrificing into my super and wondering whether the contributions should either be: 

A) Cash - the benefits with cash is that what you contribute should be what you withdraw (less tax). 

B) Shares - the benefits of shares is that if it increases with value then the amount you can withdraw also increases, but also the drawback is that if it decreases in value you can withdraw less. 

1) Based on your experiences at the ATO, during this COVID-19 climate, would you recommend to salary sacrifice into cash or shares? Could you give examples? I know you can't tell me what to do, but I need some advice since I don't know much about this at all. 

 

2) It says that it is a maximum of $15,000 of contributions per financial year: 

 

I salary sacrifice $15,000 (C) into my super and it gets taxed at 15% so $12,750 (D) is contributed to my super. I withdraw $12,750 out of my super and it gets taxed at 5% (35% marginal rate including medical levy - 30% offset) so I withdraw $12,112 (E) to spend for the FHSSS. 

 

The maximum of $15,000 in contributions per financial year (for a total of $30,000), is that calculated off (C), (D) or (E)? 

 

If it is calculated off (E) then I could salary sacrifice (C) more than $15,000 into my super per financial year.

 

 

3) When I compare my payslip to the actual tax bracket amounts it doesn't match, is this because when I do my tax return, the tax is amended accordingly? 

 

 

Thanks. 

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Devotee

Replies 0

As you say the ATO wont be able to give you advice on how to invest within your super fund. With the current market shares are generally loosing their value...

 

You can see how the FHSS payments are calculated here - https://www.ato.gov.au/Individuals/Super/Withdrawing-and-using-your-super/First-Home-Super-Saver-Sch...

You can contribute up to $15,000 a year - The FHSS maximum release amount takes into account the $15,000 limit from any one year and $30,000 total limit to the total contributions across all years when calculating the eligible contributions, before adding the associated earnings.voluntary concessional contributions – including salary sacrifice amounts or contributions for which a tax deduction has been claimed, these are usually taxed at 15% in your fund 

 

Your tax will be consolidated at the end of the year when you lodge your tax return. Are you uisng the tax tables?

 

1 REPLY 1

Most helpful response

Devotee

Replies 0

As you say the ATO wont be able to give you advice on how to invest within your super fund. With the current market shares are generally loosing their value...

 

You can see how the FHSS payments are calculated here - https://www.ato.gov.au/Individuals/Super/Withdrawing-and-using-your-super/First-Home-Super-Saver-Sch...

You can contribute up to $15,000 a year - The FHSS maximum release amount takes into account the $15,000 limit from any one year and $30,000 total limit to the total contributions across all years when calculating the eligible contributions, before adding the associated earnings.voluntary concessional contributions – including salary sacrifice amounts or contributions for which a tax deduction has been claimed, these are usually taxed at 15% in your fund 

 

Your tax will be consolidated at the end of the year when you lodge your tax return. Are you uisng the tax tables?