Centrelink Q&A: How can pensioners reduce their tax?

Ted wants to know the maximum income he can earn without paying income tax.

Centrelink Q&A: How can pensioners reduce their tax?

Ted wants to know the maximum income he can earn without paying income tax.

•••

Q. Ted
What is the maximum income a pensioner couple can have before becoming liable to pay income tax? 

A. Some older Australians may be eligible for the seniors and pensioners tax offset (SAPTO).

The SAPTO can reduce the amount of tax you are liable to pay. In some cases, it may reduce your tax liability to zero and you may not have to lodge a tax return.

To be eligible for this tax offset, you have to meet certain conditions relating to your income and eligibility for an Australian Government pension or allowance.

If you're a senior, you must meet the age requirement for the Age Pension. This includes if you qualified for the Age Pension but did not receive it.

Depending on your rebate income, you may receive a full, partial or nil offset amount.

If you have a spouse, you will be tested on your combined rebate income for the SAPTO eligibility. The amount of the tax offset is based on your individual rebate income.

In some cases, if you are both eligible for SAPTO, you may be able to transfer your spouse's unused offset to you. The Australian Taxation Office (ATO) calculates its transfer amount and includes this amount when calculating your SAPTO.

The ATO provides an online tool to help calculate whether you are eligible for the benefit and the amount of offset that you qualify for.

Are you eligible for an Age Pension? Do you know your rights? The PensionChecker™ tool has all the information you need.

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    Disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a Centrelink Financial Information Services officer, financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.





    COMMENTS

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    MICK
    10th Jun 2019
    10:33am
    This is a sales gimmick Ben. The tool has to be purchased to be used. Yeah right!
    Theo1943
    10th Jun 2019
    12:22pm
    The tool is on the ATO site Mick. No fees involved.
    Polly Esther
    10th Jun 2019
    1:54pm
    There's no flies on you MICK, you can see where they've been though. humour :-))
    etc1
    11th Jun 2019
    8:44am
    There may be one on the Centrelink site but You're correctMick. This one costs 20 bucks. I was gullible enough to pay it. I found no real use in it. It should be about 5 bucks.You can find all the info it has elsewhere. Try Noel W free calculators.
    Sundays
    10th Jun 2019
    11:16am
    When you complete your tax return, the questions re Sapto are asked. The ATO do the calculation based on your answers. It’s automatic and easy.
    Jim
    10th Jun 2019
    12:08pm
    There should be a like button Mick. Totally agree
    KB
    10th Jun 2019
    12:59pm
    Mick is right. You have to pay $19.95 for this tool. With ATO you can do a free assessment check and they will calculate if you are eligible for any payments
    Theo1943
    10th Jun 2019
    5:41pm
    No, he's not but, if you're using a tablet, the really annoying ad for "YourLifeChoices PensionChecker tool", which costs$19.95, appears on top of the link for the ATO tool, which is free.

    Please just press the reply button once only.
    Please just press the reply button once only.
    Please just press the reply button once only.
    Please just press the reply button once only.

    Cheers
    KB
    10th Jun 2019
    12:59pm
    Mick is right. You have to pay $19.95 for this tool. With ATO you can do a free assessment check and they will calculate if you are eligible for any payments
    Theo1943
    10th Jun 2019
    5:42pm
    Usually, he is. :-)
    in2sunset
    10th Jun 2019
    1:14pm
    If a pensioner earns any income from employment, then they are not eligible for the SAPTO. They pay tax on both the pension and the income. If solely on the pension, they don't pay tax
    Sundays
    10th Jun 2019
    2:28pm
    Not sure what you mean. If a pensionerr earns eneough to pay tax and meets the other conditions they get sapto. Usually part pensioners
    KSS
    10th Jun 2019
    2:05pm
    Just love this. It's OK for pensioners to seek to reduce a tax liability but all hell breaks out on this site if someone with a higher income seeks to do the same. Discrimination or what!
    Paddington
    10th Jun 2019
    8:59pm
    That makes no sense KSS. Do you know how this works?
    They don’t get any pension when they work or they get a part pension and they are paying tax as though they receive that money all the time. They have to wait until tax time to get a refund.
    Do you have a Senior Health Card?
    Why envy someone who is probably not as well off as you are.
    It would be like saying a millionaire wants to change lives with a pensioner.
    I don’t want to change places with a single pensioner renting because I know I am in a better position than they are.
    KSS
    11th Jun 2019
    1:00pm
    Paddington, this article is all about how pensioners csan minimise their tax. No different to anyone else who wants to minimise their tax.

    Except on this site when it relates to pensions; tax minimisation is all fine and dandy. When it relates to anyone else, all hell breaks out about rorting tax!

    Do you understand now?
    etc1
    11th Jun 2019
    8:41am
    There may be one on the Centrelink site but You're correctMick. This one costs 20 bucks. I was gullible enough to pay it. I found no real use in it. It should be about 5 bucks.You can find all the info it has elsewhere. Try Noel W free calculators.


    Tags: tax, finance, money,

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