Tax Advice For Doctors
Doctors, your dynamic and rewarding career in the medical industry also means that you’re considered to be high income earners, therefore falling into a higher tax bracket. When it comes to your specific deductions, inferences and tax responsibilities – you’ll require a proactive, strategic financial plan that best suits your specific needs.
Today’s blog aims to highlight the benefits that a specialised accountant can bring to doctors and specialists practicing in the medical industry. Read on!
How do a doctor’s accounting and tax needs differ?
When a doctor advances from their residency years to the heights of specialisation, their income levels and financial responsibilities will change dramatically. Doctors will need an advisor who is able to support them to achieve both their short and long term financial goals. To this end, tax and cash flow planning is crucial. Areas in which a specialised accountant can further deliver expert advice are outlined below.
Tax deductions for doctors
If you’re a doctor or specialist, it pays to learn what you can claim at tax time. Engaging a specialist accountant who knows the specific deductions will result in significant savings come tax time. Some of the areas doctors are eligible to claim deductions are listed below.
- Continuing education costs
- Professional indemnity insurance
- Medical journal subscriptions and publications
- AMA, AHPRA or other medical professional association membership fees
- Medical equipment and insurance for that equipment
- Vehicle and travel expenses
- Work related or protective clothing and its care
- Gifts and donations
Medical Practice Structures and Scaling
As doctors and specialists reach the milestone of partnership – which can include becoming a business owner depending on the medical practice structure – additional financial issues become relevant. These may include:
- Setting up new structures such as trusts to enable the most effective income streaming.
- Considering income/life insurance to protect interests and assets.
- Considering buy in/buy out when introducing new doctors.
- Ensuring that cash flow is managed properly.
- Ensuring that compliance with ATO guidelines are maintained.
- Succession and estate planning.
- Investment advice.
- Advice on superannuation and potential for self-managed superannuation fund needs.
Superannuation for doctors
As mentioned above, many doctors and their spouses accumulate various super accounts throughout their careers. Each one of those will have their own set of structures. A specialist accountant will be incredibly helpful in collating and ensuring these are structured for the greatest return. Superannuation will also form a significant part of a doctor’s retirement assets. Hence, it is critical that they choose the right investment options. These must be in line with their risk profile and timeframe to retirement, have reasonable fees and good long-term performance.
How can Wilson Pateras best support doctors accounting requirements?
Engaging a Wilson Pateras expert accountant to review and discuss these matters ensures that doctors will be making the correct distributions annually, whilst remaining compliant with ATO guidelines. Having worked with medical professionals at various stages of their career trajectory, Wilson Pateras know that consulting with expert accountants will only ever be to a doctor’s benefit.
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