The end of another financial year is already on the horizon. If you’re like a lot of people, you probably won’t start reviewing your finances until after 30 June, potentially missing opportunities to reduce your tax while building wealth. We've outlined some tax effective strategies below to help you.
1. Government co-contributions
What’s the strategy?
The current account deficit narrowed to a seasonally adjusted $16.55bn in the first quarter of 2010 from the fourth quarter of 2009, the ABS said. But the deficit on goods and services, in seasonally adjusted chain volume terms, widened by $1.5bn over the quarter, and is expected to subtract 0.5% from GDP growth.
US markets were closed overnight for the Memorial Day holiday, while markets in the UK were closed for the Spring Bank holiday. European stocks finished a quiet with a slight rise, as German stocks outperformed their Continental rivals in the first reaction to a downgrade of Spain by Fitch Ratings.
The Stoxx Europe 600 finished the day with a rise of 0.3% to 244.79, led by carmakers and technology-sector firms. Shares of Daimler AG rose 1.5% and shares of business software giant SAP rose 1.7% as the German DAX finished with a rise of 0.3% to 5,964.33.
US stocks fell on Friday, ending their worst month in more than a year as measures of consumer spending and Chicago-area business activity disappointed. Walt Disney, Bank of America and Cisco Systems were among the decliners.
US stocks surged on Thursday, posting their second largest gain this year as fears of eurozone contagion receded and investors flocked back to riskier stocks, lifting shares of technology companies including Intel and Microsoft. American Express also jumped, boosted by an analyst upgrade.
Private new capital spending on buildings and equipment fell 0.2% to $27.7bn in the first quarter of 2010 from $27.75bn in the fourth quarter 2009, the Australian Bureau of Statistics said.
Spending rose 1% from the first quarter of 2009. A sixth estimate of expenditure shows companies expect to invest $108.7bn in the fiscal year ending June 30, 2010, a fall of 2.5% from the sixth estimate for 2008-09.
The second estimate for 2010-11 is $103.9bn, up 16.9% from the corresponding estimate for 2009-10.
The economy is set to continue to stand out on a global basis as economic growth increases to 3.25% in 2010 before accelerating to 3.5% in 2011, according to the Organisation for Economic Cooperation and Development.
The new outlook supports a further gradual tightening in interest rates. Managing the exit strategy from the crisis is less problematic in Australia than most countries, with recent tightening of monetary and fiscal policy a welcome development.
US stocks fell as worries about the global economy flared anew late in the session, overcoming an earlier rally that had been powered by encouraging US economic data. Microsoft, McDonald's and American Express were among the decliners.
For the first quarter, the value of building work completed in Australia rose 4.4% from the fourth quarter of 2009 to $19.81bn, the Australian Bureau of Statistics said. More broadly, the value of total construction, which includes building and engineering work, rose 1.9% from the previous quarter to $39.48bn. A quarter ago, posted 6.1% building work growth and 2.6% total construction growth.
While the chances of a housing collapse remain remote, a period of softer or stagnant house prices is likely this year, Moody's said. Noting declining foreign investor interest and tighter domestic policy, including six interest rate hikes from the Reserve Bank of Australia in its last seven meetings, the surging momentum in home prices last year is over.