Question 4 Nelson, aged 58, has just retired He has superannuation totalling $300,000, of which $60,000 is tax free and the balance is paid from taxed funds Nelson is planning to roll all of his superannuation to an allocated pension and draw 4 as a minimum annual pension payment Nelson receives $80,400 in other taxable income for the year Required Calculate the tax payable, relative to the receipt of his pension payments If Nelson completes a cash out and re contribution strategy for $100,000, calculate the tax payable relative to the cash out, and on receipt of his pension payments Should Nelson complete the cash out re contribute strategy for $100,000, explain why or why not

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Posted on Sep 30, 2024

Question 4 Nelson, aged 58, has just retired. He has superannuation totalling $300,000, of which $60,000 is tax free and the balance is paid from

Question 4

Nelson, aged 58, has just retired. He has superannuation totalling $300,000, of which $60,000 is tax free and the balance is paid from taxed funds. Nelson is planning to roll all of his superannuation to an allocated pension and draw 4% as a minimum annual pension payment. Nelson receives $80,400 in other taxable income for the year. Required:

Calculate the tax payable, relative to the receipt of his pension payments.
If Nelson completes a cash out and re-contribution strategy for $100,000, calculate

the tax payable relative to

1. the cash out, and
2. on receipt of his pension payments?
Should Nelson complete the cash out & re-contribute strategy for $100,000, explain why or why not.