Case Studies

Case studies demonstrate our versatility

Helping clients to maximise their financial returns from every commercial opportunity is a key objective at Accountability1.

Case study 1 -Tax planning
See how a carefully developed financial plan and good knowledge of tax laws can enable us to optimise an investment situation for a typical executive:

John is a manager earning $60,000 p.a. He is seeking an investment that provides tax advantages as well as a medium term income stream.

Accountability1's tax planning strategy, as shown in the table below, helps John achieve these objectives and there are additional strategies he could employ to bring the tax advantages forward.

John purchases 5 woodlots in a reputable plantations project for $15,000 excluding GST, and then registers for GST. He finances this investment (excluding GST) with a 7-year principle and interest loan from a finance company. Repayments on his loan are not required until the beginning of the next tax year.

John's investment is 100% tax-deductible, so he receives a tax benefit of $4,725 in his annual tax return. He can also expect returns from harvesting approximately 8-12 years after planting.

	No tax planning	Using ACCOUNTABILITY1 tax planning
Annual Salary	$60,000	$60,000
Tax deduction from forestry investment		$15,000
Taxable Income	$60,000	$45,000
Tax on income	$13,500	$8,775
After tax position	$46,500	$51,225
TAX SAVING	$0	$4,725

Benefits:

• Reduction in tax
• Tax benefit can be used to secure other investments
• PAYG variation can increase monthly cashflow
• Diversified investment created

Two further brief case studies show how Accountability1 can help employees in typical situations minimise tax and maximise the value of their assets.

Case study 2 - Pre-retirement superannuation
Tony is 60 years old and still enjoying work, but he is looking forward to an active and fulfilling retirement. He wants to build his assets so that he can maximise his cashflow once he retires and is no longer receiving income from employment.

We advise him to divert future employment income into his superannuation fund, thus reducing his tax exposure and increasing his assets at the same time.

Case study 3 - Travelling executive
William is a highly paid executive for a big company. He often travels for work and wonders how this might affect his taxation situation.

We advise him to restructure his existing salary to include a travel allowance. The resulting tax deduction can be offset against his income, thereby reducing his tax liability significantly.