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Nick Bruining: For high-income earners, savings bonds are the century-old investment vehicle to dodge CGT
['Nick Bruining', 'The Nightly']
The Nightly
For high tax-payers, the use of special tax-paid savings bonds could see savings of at least 5 per cent in the effective rate of tax paid.
Savings bonds — offered by registered Australian life insurance companies — operate in a similar way to superannuation funds, but with no access restrictions.
However, a 30 per cent tax offset applies — but in this case it is a use-it-or-lose-it arrangement.
You can direct who is to receive the proceeds from a savings bond when you die.
Cost-wise, most savings bonds are on par with retail superannuation funds, but without the economies of scale now existent in the $4.5 trillion superannuation industry.