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Splitting super with your spouse

Posted on June 8, 2016 by admin

Since change is an inevitable part of Australia’s superannuation system, trustees and taxpayers should always be aware of and on the lookout for tax-saving strategies to prevent the consequences of unforeseen super changes.

One such strategy, which is not only straightforward but also highly-effective, is splitting superannuation with your spouse.

Splitting super with your spouse involves one partner (usually the older and higher earner) instructing their super fund once a year to transfer 85 per cent of their concessional (before-tax) contributions made that year to their partner’s super account. The receiving spouse must be between 55 and 65 years of age if not retired or under 55 years old if retired. The partner splitting their contributions can be of any age. Non-concessional contributions (after-tax) cannot be transferred.

The spouse-splitting strategy can be extremely useful and can create many advantages. For example, it can enable a couple to maximise the amount that could be withdrawn tax-free if either of them ceased working between their preservation age and 60.

It can also help a couple to withdraw more from their accounts. Individuals aged between 55 and 60 can only withdraw the first $185,000 of the taxable component tax-free, therefore, having two large funds means a couple could withdraw $370,000 tax-free between them.

If a couple found it to be appropriate, the older contributing spouse could also work until they were 75 to continue the spouse-splitting strategy if the younger spouse passed the work test. This would keep the older spouse in a lower marginal tax bracket, who would then be able to fund some household expenses through tax-free withdrawals from the receiving spouse’s super.

Another potential benefit in moving one spouse’s superannuation to their partner’s account is that it provides protection against future changes that may restrict lump sum withdrawals or create a tax on higher balances. Two separate superannuation accounts also offer more flexibility than keeping the majority of superannuation savings in the name of just one partner.

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Tips for incorporating career mentoring into your business

Posted on February 28, 2020 by admin

A career mentorship program involves partnerships between employees to develop professional skills and gain industry knowledge. Due to their requirement for a collaborative effort, career mentoring programs are often seen as powerful development tools for cultivating both leaders and employees within a business.

Whether you are a small business owner or a multinational corporate leader, the implementation of a mentorship program will always be profitable for businesses as not only does it create a harmonious workplace culture, it also helps to attract and retain employees.

As straight-forward as career mentoring sounds, there are a few key tips to keep in mind when building a mentorship program for your business:

Make sure your mentoring program is clearly defined:
To create a successful mentoring program, both mentors and mentees should have a concise understanding of their roles and what they would like to gain from the mentorship. By succinctly outlining the purpose of the mentoring program, mentors and mentees are more likely to keep organised and communicate respectfully with the guarantee of mutual rewards.

There should also be short-term and long-term goals established for all parties involved, including the business. These goals could be the narrowing of particular skill gaps or creating a more open workplace culture. By having these goals set in stone, both mentors and mentees and have a clear direction to work towards.

Personalise the match-making process:
Often times, businesses will match a mentor and mentee together depending on their skill-set and position within the company. While on paper, this may appear to be an efficient process, but the lack of chemistry between a mentor and mentee may prove to be devastating for the workplace environment.

As a result, be sure to involve both mentors and mentees in the match-making process and take into account personality traits. You could do this by asking employees to take a personality test to ensure compatibility in career goals, personal interests and preferred communication methods.

Be involved as a third-party:
Lastly, it is the responsibility of the business to check-in on the progress of mentorship programs in order to understand how mentors and mentees can grow together and what improvements can be made to the program. Remember to always refer back to the long-term goals established and consider the feedback provided by mentors and mentees from the program.

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