Almost half a million Australians identify as gay or bisexual, many of whom are in long-term relationships. Although same-sex marriage hasn’t been legislated in Australia, changes to tax, superannuation, social security and family laws in recent years – such as the inclusion of same-sex partners in the definition of ‘spouse’ – mean same-sex couples either in a de facto or registered relationship have almost all the same legal rights as heterosexual couples.
The United States might have legalised same-sex marriage, but when it comes to tax and estate planning there are different rules in every US state. In Australia, these rules are more similar across the states. So what do same-sex couples need to consider when it comes to tax and estate planning in Australia?
Putting savings strategies in place
The 2013 Census found that people in same-sex relationships were generally better educated, had higher incomes, and were less likely to have children living with them than heterosexual couples.
Of course, not every same-sex couple will be the same, and regardless of a person’s situation, there is a need for good advice when it comes to managing their money.
Death benefit nominations are important as they can give you control over who receives your superannuation death benefits.
Making the most of tax and super benefits
The laws recognising same-sex relationships mean that a number of tax benefits are now potentially available to same-sex couples, including:
• the ability to claim a tax offset for superannuation contributions made for a low income earning spouse
• the ability to transfer unused Seniors and Pensioners Tax Offset to a partner
• benefits for Medicare levy calculations if one partner is a low-income earner.
If a relationship breaks down, tax relief for some capital gains arising from the transfer of assets is also available for same-sex couples.