Many taxpayers getting their boxes of receipts into some order in preparation to file their 2007-08 returns will get a resounding reminder what a significant year from a tax and superannuation perspective is nearing its final five weeks.
Just consider a few things.
We are reaching the end of the inaugural full year of the new super system. This means, of course, that retirees over 60 will not only pay no tax on their super lump sums and pensions paid during 2007-08 (and beyond) but many investors will therefore pay less tax from this financial year on income and capital gains from their non-super investments.
And what about the self-employed! Their tax returns for this financial year - at least for many of them - will reflect how they no longer have to make significantly larger contributions than the employed to be entitled to the same size tax deductions.
Then there are the small business people who sold their businesses in 2007-08. For the first time, eligibility for the valuable small business CGT concessions and exemptions on the sale of an eligible business can be measured on turnover if desired rather than asset value.
This change for sellers of small businesses means that those with highly valuable enterprises in terms of assets may still be eligible for the small business CGT tax breaks provided their turnovers were under $2,000,000.
Another factor to keep in mind is that 2007-08 marks the beginning of the countdown to the removal of the special provision allowing those over 50 to make concessional (previously known as deductible) super contributions of up to $100,000 a year.
This transitional provision for the new super system allowing contributions of up to $100,000 ends on June 30, 2012. Meanwhile, the maximum concessional contribution in 2007-08 for those under 50 is $50,000.
Particularly given that the latest federal budget contains little in the way of super - which I personally believe is a good thing - see Smart InvestingTM, May 15 - some super fund members and taxpayers may overlook the monumental changes of the past 12 months; at least until they fill out their next tax returns.
Most of these changes had been announced in the May 2006 budget, which seems so long ago.
22nd-May-2008 | 
