Glossary Financial Terms
S - U Salary sacrifice
Part of your before-tax salary can sometimes
be ‘salary sacrificed’ straight into superannuation – which
means it is taxed at a beneficial rate (15%), and paid before
income tax (lowering your taxable income). Many people find this
a valuable way to save for retirement so ask your employer if it
is available to you.
Share
An investment that represents ownership in a
company or corporation.
Self Managed Superannuation Fund (SMSF)
These are funds that are established for a
small number of individuals (usually fewer than 5). Each
individual trustee of the fund is a fund member, and no member
of the fund is an employee of another member of the fund, unless
those members are related. The trustee can be a corporate entity
and no trustee of the fund receives remuneration for his or her
services as a trustee. A SMSF is registered, reports to, and is
regulated by the Australian Tax Office (ATO).
Superannuation
Money that you and your employers put aside
in a superannuation fund during your working life to use when
you retire.
Superannuation guarantee
An Australian Government requirement that
employers pay a minimum amount, equivalent to a certain
percentage of your earnings, into your superannuation fund or
retirement savings account.
Super splitting
Legislation now allows the tax-effective
savings of superannuation from one partner to be used to bolster
their spouse’s super fund account. This is particularly
effective for those who are approaching their Reasonable Benefit
Limit (RBL) – it allows for two RBL’s in a partnership, no
matter who is earning most money. Ask your financial adviser if
this course of action is appropriate for you.
T Taxable income
The excess of assessable income over
allowable deductions calculated according to the applicable
income tax legislation.
Taxes
Fees placed on income, property or goods
which is collected by the government to support costs and
programs.
Tax file number (TFN)
The personal tax identification number
supplied to you by the ATO when you begin working and paying
tax.
Technical analysis
Method used to identify investment
opportunities through the study of price action. A chart
representing past price movements, is the principle tool used to
identify trends on which analysts can base their future
predictions.
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