6 Tax Efficient Investments

Tax efficient investing refers to the making and holding of investments in such a way as to optimise the tax treatment that applies to the income and capital returns on those investments.

As the following will demonstrate, the same investment returns will be taxed in quite different ways depending on the type of investor that makes the investment.

The general idea behind tax planning is straightforward. It is as follows: Income tax will be lower, after tax rates of return will be greater, and wealth will be maximized by using tax efficient practice structures, investment structures and superannuation strategies.

The 6 Key Tax Efficient investments are:

  1. Invest in CGT free homes (Your family home)
  2. Create and run CGT free businesses owned by tax efficient trusts
  3. Own CGT free business premises
  4. Maximise super contributions (whether you are an employee or business owner)
  5. Invest in tax efficient investments, such as CGT concessional franked shares and
  6. Use tax efficient investment vehicles such as SMSFs, companies and trusts.

Remember, as an investor tax is a state of mind. You have to think about tax all the time.

You must understand your tax profile.

  • What is your tax rate?
  • What sort of income do you derive?
  • Are you paying too much tax? Are you paying too little tax?
  • Can you use an SMSF or a trust to derive investment income?
  • Can you use a trust or a company to run your business or practice?

Tax efficiency really pays off. For example, if you  set up your practice so an extra $100,000 of debt is tax deductible you might save $2,000 cash a year every year in perpetuity. If you move $10,000 of income into a tax free SMSF you might save an extra $4,000 cash a year every year in perpetuity.

So time spent improving your tax profile is time well spent.


At Aspiire we help clients with

  • Home Loans
  • Investment Loans
  • Debt Consolidation
  • Refinancing
  • Commercial Loans
  • Rapid Debt Reduction strategies