We spend a lot of our time trying to optimise our investment choices, but not many people actually talk about tax investing or how to maximise your tax returns. Tax-effective investment strategies are the best ways to boost your returns. To do it properly, you may want to choose the ones that suit you the most.

There are many combinations or permutations you can go for, but if you want to be successful, you may want to keep in mind the three following strategies:

  1. Superannuation

When it comes to taxation benefits and how to maximise your tax returns, the superannuation shouldn’t be underestimated. In this case, retirees are the ones who will most likely benefit from these tax breaks and franking credits.

Basically, superannuation offers retirees an incredibly useful amount after tax. Any income that was earned during the retirement stage in the superannuation fund will not be taxed – which means that franking credits will be very beneficial. Once you go over the age of 65, you will no longer have to pay for the workforce – so everything you take out is virtually tax-free.

This process is relatively complicated, so if you want to learn how to maximise your tax returns, you’ll need someone to be your guide through this process once you hit the appropriate age.

  1. Corporate Structures

A corporate structure is basically an investment company created to hold your investment assets. They’re a great option to use when the owners don’t need to be paid for profits and income. A corporate structure will pay on average 30% tax rate, no matter the income of the company.

This may not seem like much at the moment, but the truth is that personal taxation may easily go over 30%, depending on the growth of the company’s income. Therefore, if you have a high personal income, this may be a good time for you to go corporate. If you want a tax-free cash flowing business, this one may be the best option on how to maximise your tax returns.

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  1. Discretionary Trusts

A discretionary trust will allow you, the owner, to allocate the earnings to the trust member that has the lowest income. As a result, the amount of tax that you pay becomes the lowest possible. If you have a high income, it’s obvious that your tax payments will be just as high.

On the other hand, if you allocate that income to an eligible child or a spouse that has a lower income, you’ll be able to efficiently maximise your tax returns. This option is very flexible, and you should fully explore it to make sure that you take advantage of all of its benefits.

If you want to learn how to maximise your tax returns, you may want to look at all your taxation options. Doing these changes may cost you some cash in the initial stage, but if you consider the savings over time, you’ll get back their worth and more.