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It’s tax time! What you need to know about your insurance and investments

Tax rules aren’t always simple when it comes to life insurance and investments.
Here’s some information to help keep you on top of your tax time to-do list.

Insurance Help

Are Life (Death) insurance premiums tax deductible?

If you hold Life cover, you generally can’t claim a tax deduction for premiums paid. But if your Life Cover is for business purposes, then your tax situation may be different, so please seek advice from your financial adviser or a registered tax agent.

If you hold Life Cover inside super and have made personal contributions to pay the premiums by direct debit, credit card, or BPAY, you may be able to claim a tax deduction for some or all those contributions. Before completing your tax return, you may receive a form from us, which includes a ‘Notice of Intent’ form that you’ll need to complete and send back once confirmed by your fund or insurer they or we will send you a letter acknowledging that they received your form.

If you haven’t made any personal contributions or have paid your premiums from your super balance. You can lodge your tax return.

Should tax be paid on a Life cover payout? – Insurance payouts on a Life Cover claim are generally not taxable. But if you’ve received a Life Cover claim payout for business purposes, then your tax situation may be different, so please seek advice from your financial adviser or a registered tax agent.

Insurance payouts on a Life cover claim for insurance held inside super – may be taxable depending on the way it was paid, the tax components that make up the payout and the claimant’s relationship with the deceased. Payouts on life insurance policies held inside super can be a complex area to navigate and we recommend seeking professional tax advice.

Are Total and Permanent Disability (TPD) insurance premiums tax deductible?

If you hold TPD cover, you generally can’t claim a tax deduction for the premiums paid. But if you hold TPD cover for business purposes your tax situation may be different, so please seek advice from your financial adviser or a registered tax agent.

If you hold your TPD cover inside super and have made personal contributions to pay the premiums by direct debit, credit card, or BPAY, you may be able to claim a tax deduction for some or all those contributions. Before completing your tax return, you may receive a form from us, which includes a ‘Notice of Intent’ form that you’ll need to complete and send back once confirmed by your fund or insurer they or we will send you a letter acknowledging that they received your form.

If you haven’t made any personal contributions or have paid your premiums from your super balance. You can lodge your tax return.

Should tax be paid on a TPD cover payout? – Insurance payouts on a TPD claim are generally not taxable. But if you’ve received a TPD claim payout for business purposes, then your tax situation may be different, so please seek advice from your financial adviser or a registered tax agent.

Insurance payouts on a TPD claim for insurance held inside super – may be taxable, the amount of tax, if any, will depend on your age, the way the payout was received, and other circumstances. Payouts on TPD insurance policies held inside super can be a complex area to navigate and we recommend seeking professional tax advice.

Are Critical Illness (Trauma) insurance premiums tax deductible?

No, premiums paid for Critical Illness cover aren’t tax deductible.

Should tax be paid on a Critical Illness payout? – No, you aren’t expected to pay tax on Critical Illness payouts.

Are Income Protection insurance premiums tax deductible?

If you hold Income Protection cover, you can generally claim some or all of your premiums as a tax deduction. To help you complete your tax return, your insurer will provide you with an Annual Letter that summarises the total premiums paid over the past financial year and the portion that is tax deductible.

If you hold Income Protection cover inside super – and have made personal contributions to pay the premiums by direct debit, credit card, or BPAY, you may be able to claim a tax deduction for some or all those contributions. Before completing your tax return, you may receive a form from us, which includes a ‘Notice of Intent’ form that you’ll need to complete and send back once confirmed by your fund or insurer they or we will send you a letter acknowledging that they received your form.

If you haven’t made any personal contributions or have paid your premiums from your super balance. You can lodge your tax return.

Should tax be paid on Income Protection payouts? – Some or all insurance payouts on an Income Protection claim will need to be declared as income on your tax return. To help you with this, your insurer will send you an Annual Benefit Payment Letter that outlines the benefits paid over the past financial year and what portion isn’t considered taxable income.

Insurance payouts on an Income Protection claim for insurance held inside super – will need to be declared as income on your tax return. However, some insurance payouts received may have already had tax withheld. Your insurer may send you a PAYG Payment Summary that outlines the insurance benefit payments you’ve received and the amount of tax withheld.

Business Insurance & Expenses

Are Business Expense insurance premiums tax deductible?

If you or your business hold Business Expenses cover, generally some or all premiums paid may be claimed as a tax deduction. To help prepare tax returns, your insurer will send an Annual Tax Letter summarising the total premiums paid and the portion that is tax deductible.

Should tax be paid on Business Expenses payouts?

If you or your business received insurance payouts on a Business Expenses claim, those payments will need to be declared as income on the relevant tax return. To help you with this, your insurer may send an Annual Benefit Payment Letter that outlines the benefits paid over the past financial year and what portion isn’t considered taxable income.

Super Funds & Contributions

Are my Self-Managed Super Fund’s (SMSF) personal insurance premiums tax deductible?

If your SMSF holds your insurance policy, you’re not eligible to claim premiums paid by your fund as a personal tax deduction. However, the SMSF trustee may be able to claim some or all of the insurance premiums it paid during the financial year when lodging the SMSF Annual Return. Your insurer will send you statements for the 2023/24 tax year.

How do I claim my personal super contributions?

Before completing your tax return, complete a ‘Notice of Intent’ form, which you can request from us, your super fund or obtain from the ATO. Once completed, you’ll need to send to us or your super fund directly and they or we will send you a letter acknowledging that they received your form and the amount you are eligible to claim.

Investment Earnings

Are my Annuity payments or income earnt on investments taxable?

You may need to declare some or all these payments as income in your tax return. However, some payments received may have already had tax withheld. Your product provider may send you a PAYG Payment Summary or Annual Tax Report outlining the payments you’ve received/generated and the amount of tax withheld, if applicable.

When will I receive my End Of Financial Year (EOFY) statements?

These are provided to help prepare your tax return and you can expect to receive them as early as mid-July with some product providers taking until late September or even early October to get their annual reports out. Our Brisbane and Launceston offices will do all that they can for you to obtain your required reports in a timely manner. Please reach out to your support team on 1300 590 790 should you require the information or estimated time frames.

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