As part of your Self Managed Super Fund you can of course trade in shares as an investment. Most people trading in shares are taking the long term view that these investments are to support their retirement. Such investments would in fact be able to be placed within a Self Managed Super Fund, still under your complete control, and attract a much lower rate of tax on profits than investments made outside of super.
Are you trading outside of Super and paying too much tax?
If you’re trading in shares, or planning to do so as a long term investment strategy, then you should take into consideration the different tax treatment of such investments within Superannuation environment.
The profits on your share trading inside superannuation structure are taxed at the super rate of 15%, instead of your usual marginal tax rate. That additional tax you would have paid if you were investing outside of super now remains with you in your Superannuation investment vehicle – it’s yours now – representing an improved investment return for you, year after year. And over time, this really adds up.
Capital gains and any profits realised once you reach 60 years of age (or at retirement) are also treated in a concessional nature by the Australian Taxation Office – and less tax paid to the government means more retirement income for you!
Start trading “inside” now!
That tax you paid on your investment income last year? It’s gone forever. If you were only paying 15% tax on that income instead of your marginal rate, you’d have more money to invest this year. Which means a better outcome next year. Which means…
… the time to start is now!