Question
William Jones is aged 56 and is self-employed. He is in good health and he has asked you for advice on whether he should take
William Jones is aged 56 and is self-employed. He is in good health and he has asked you for advice on whether he should take his superannuation as a lump sum at the end of the current tax year or whether he should wait unit he is 60. Assume that the fund is a taxed fund.
Over the years William has contributed to a superannuation fund for self-employed business people, and the most recent statement from his taxed superannuation fund states the following entitlements:
Concessional contributions $420,000
Non-concessional contributions $250,000
Previous growth (interest and capital gain) $180,000
Before the end of the current year William plans to contribute another $10,000 and the superannuation fund has reported an income of $20,000 before tax.
Required:
Advise William on the below i) to iv).Show all calculations and cite relevant legislation where appropriate to support your answer.
i)The effect of his contribution on his personal tax.
ii)The tax if any to be paid by the superannuation fund on the income on William's investments.
iii)The tax impact of taking the total value of the superannuation benefits at the end of the current tax year.
iv)The tax impact of taking the total value of the superannuation benefits after he turns 60.
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