Are you considering s tax-effective investment? It’s important you have all the facts to make an informed decision.
Some investments offer tax benefits such as reducing assessable income or increasing deductions, but end up being outside the law. You can check with the ATO to ensure promised tax benefits will be available.
Find out as much as you can about an arrangements before investing. Make sure the arrangement has a prospectus or product disclosure statement ang get independent advice about the promised tax benefits from a professional advisor. A person associated with th scheme is not independent.
Start by visiting www.ato.gov.au/investing annd read and the Investigate Before Investing fact sheet. It provides information about tax effective investing and how to detect potential tax avoidance schemes.
You can also check if the arrangement you’re considering is covered by an ATO product ruling confirming the tax benefits, or if a Taxpayer Alert has been issued warning about the arrangement.
Doing your research will help you avoid negative consequences including having to repay tax and incurring interest and penalties.
Article by Christie Lewis
Christie is Practice Manager at Alan Lewis Accountants . Besides accounting, her passion is for all things small business (and blogging, of course). You can contact Christie directly at christie@lewistaxation.com.au.
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