Clock ticking for tax on 'own occupation' TPD insurance
Superannuation fund trustees with 'own occupation' style total and permanent disablement (TPD) insurance policies should rethink their cover strategies, according to Macquarie Adviser Services' executive director, David Shirlow.
Premiums for 'own occupation' style TPD cover were previously fully deductable, but following the new draft ruling by the Australian Taxation Office (ATO) on the deductibility of TPD premiums for super fund trustees, it will be only partially tax deductible from 1 July, 2011.
Shirlow said that trustees and their members may now want to revisit their superannuation options and look for ones that offer a fully tax deductable solution.
The ATO recently issued a private ruling for Macquarie Life's Super Optimiser product feature, which Shirlow said created an "optimal tax outcome" that trustees could consider as an alternative.
AUTHOR
Ashleigh McIntyre
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