Quiz – taxation of savings

The tax a person pays on their savings depends on the vehicle they save in – for example, they might save in a bank account or in an investment property. Of the following savings vehicles, which one is the least favourably taxed for an average income earner (someone who has a personal marginal tax rate of 34.5 per cent (including the Medicare levy)?*

Australian companies pay tax on their profits. When their profits are paid out to Australian shareholders as dividends, how would they be taxed in an individual’s hand?*

Taxed at an individual’s marginal tax rate with tax credits received from the company for the company tax that has been paid
Taxed at a preferential rate of 15%
Exempt

The tax treatment of housing depends if the owner of the house uses it as their home, or as a rental property. Which type of housing is more concessionally taxed?*

Owner-occupied property
Investment property

Superannuation contributions and earnings on superannuation assets in the accumulation phase are taxed generally at a flat rate of 15 per cent while earnings on superannuation assets in the retirement phase are tax free. In contrast, an individual’s other income is generally taxed at marginal tax rates that increase with income. Given this, which statement below is correct?*

Different people receive the same rate of the tax concession on their superannuation savings relative to the marginal tax rate applied to their income.
Different people receive a different rate of the tax concession on their superannuation savings relative to the marginal tax rate applied to their income.

Which types of shares may be more attractive to Australian investors from a tax perspective?*

Indifferent between Australian and foreign shares
Australian shares
Foreign shares

What is the tax concession associated with investment properties?*

The capital gains tax treatment of the property
Negative gearing the property
The concessional taxation of rental income

Quiz - taxation of savings