Use an agribusiness project to build long term wealth and apply the tax benefit to offset a Capital gains tax liability.

Case Study - Joe

• Joe's annual income is $90,000
• Realised captial gain (after 50% discount) $50,000
• Additional tax payable on captial gain $20,750
  

Strategy

• Invest $55,000 in a Timbercorp agribusiness project
• Fund the investment through Timbercorp Finance with 10% deposit using a 7 year principal and interest loan
• Use the Tax deduction from the investment to offset the Capital gains tax liability
  

Outcome

Joe has:

• Used funds other wise paid in tax to diversify his Portfolio into a quality agribusiness investment
• Eliminated his capital gains liabiility, saving $20,750 tax
• Minimised impact to cashflow by borrowing to invest
  

• Deposit $5,500
• Less GST refund $5,000
• Net outlay $500
• Ongoing monthly repayments $841

Joe's Tax Position Comparison

	BEFORE	AFTER
Income	90,000	90,000
Net Gain	50,000	50,000
Taxable income	140,000	140,000
Deduction for investment		-50,000
Assessable income	140,000	90,000
Tax Liability (& Medicare Levy)	45,200	24,450
Tax Savings		20,750

*Source Timbercorp Agribusiness Investment Managers

IMPORTANT INFORMATION:

This information was prepared by SECURITOR Financial Group Limited ABN 48 009 189 495 Australian Financial Services Licence Number 240687. To the extent permitted by law, no liability is accepted for loss or damage as a result of reliance on this information.

The investment information or general advice provided in this publication does not take into account your personal objectives, financial situation or needs and because of that, you should consider the appropriateness of the information or advice having regard to these factors.

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Tags:  agribusiness,