Investing fees and tax basics (Australia)

Plain-English basics for people in Australia. This explains how things work and where to check the official rules. It never picks a product for you.

Why small fees matter

A yearly fee is taken every year from the whole amount, so it adds up. On A$10,000 a 1% yearly fee is A$100 a year, and over 20 years the difference between a 0.2% and a 1.2% fee can be a large share of the final amount, because the fees also stop earning anything.

The fees to look for in Australia

the management fee (shown as a percentage a year), brokerage on each trade, the buy-sell spread on managed funds, and administration and investment fees inside super. Ask for all fees in money, not only in percent.

Tax basics in Australia

Interest is part of your assessable income. When you sell an investment for more than you paid, the gain is a capital gain; individuals who held the asset for more than 12 months can usually reduce it by the 50% CGT discount. Dividends may come with franking credits. Super has its own tax rules. Check the ATO or a registered tax agent for your case.

Keep records

Keep every buy, sell, dividend and interest statement. Tax on gains is worked out from what you paid and what you received, including costs.

Regulator guide: ASIC's Moneysmart: how to invest.

General information, not a recommendation. This page explains how things work. It does not pick a product for you or say where to put your money, and it does not consider your goals or situation. For personal advice talk to a licensed adviser in Australia - a licensed financial adviser (on ASIC's Financial Advisers Register).

Frequently asked questions

What fee is 'low'?

It depends on the product. Compare like with like and always ask for the total cost in money.

Do I pay tax on investments?

Usually on interest, dividends and gains, with allowances and special accounts that differ by country. Check the official tax site or a tax professional.

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