Published on 27 Aug 09
by NATIONAL DIVISION, THE TAX INSTITUTE
This paper deals with a number of tax efficient strategies adapted to extract money from companies. The paper covers principles in each case, the practicalities, what the ATO has had to say to date and the likely areas of focus by the ATO, both today and in the future. Topics covered include:
- getting money out of cash box companies, dividends, super, termination payments, bonuses, retainers, consulting fees, liquidation
- accessing the cash before it goes into a corporate beneficiary - via an interposed trust;
- loans by companies to and out of limited partnerships;
- acquiring wasting assets in companies with retained earnings;
- treatment of franked dividends to non-residents (via discretionary trusts);
- dividends to companies with negative net assets (via discretionary trusts);
- dividends to negatively geared shareholders;
- passing shares to the trustee of a testamentary trust;
- converting 7-year loans to 25-year Div 7A complying loans; and
- franked dividend to shareholder who makes super contributions.
Paul Hockridge FTIA is a Tax Partner at Deloitte with over 30 years
experience in Tax, asset protection, estates-succession planning,
FBT and salary packaging. Paul specialises in advising high wealth
families and closely held businesses and advises mainly accounting
and law firms. Paul is a member of various professional association
committees and has been involved in consultation with both Federal
and State Governments on a variety of tax matters.
Current at 17 October 2008
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