Many doctors have limited opportunities for legitimately diverting pre-tax income to lower tax rate related persons, and superannuation is the simplest and easiest way of doing this. In fact it’s really the only way of doing it, at least on any scale. The new super rules present a new world of investing where the SMSF is a tax free family investment vehicle, and where paying tax is almost optional for persons over age 60. And that’s a large, and increasing, proportion of the population.

Certainly paying the maximum deductible contributions each year, for both yourself and your spouse, is a good start. Get your super balls rolling as early as you can and, if you are already over 50, make a big effort to pay the maximum deductible contributions of $100,000 a year whenever possible.

From 1 July 2009 the age based deductible contribution limit is $25,000 a year irrespective of the member’s age with transitional rules for those over 50: they can pay $50,000 a year each year until 30 June 2012. The transitional rules are just that, ie transitional rules, and they run out on 30 June 2012, and there will be no “catch up” facilities after that. This means it’s imperative for younger doctors to contribute the $25,000 a year each year for themselves and their spouses, and for older doctors to contribute $50,000 a year each year for themselves and their spouses while they can