Client Background
Joe, 61, and his wife Jane, 54 (not real names), had recently sold their family farm and were looking for a smart way to manage the proceeds. They wanted to preserve their wealth, reduce future tax obligations, and create a sustainable income stream for retirement. Like many conservative investors, their initial instinct was to keep the funds in cash and prioritising safety over growth.
However, through a structured financial strategy, we helped them move from a purely defensive mindset to a diversified, tax-efficient investment plan designed to protect and grow their wealth long-term.
The Challenge
The sale of the farm resulted in a significant lump sum. Without proper planning, Joe and Jane faced a large capital gains tax bill and the risk of missing out on valuable contribution opportunities within superannuation.
Our goal was twofold:
- Minimise tax arising from the sale and future investment income.
- Maximise long-term financial security through effective superannuation and investment structuring.
Our Strategy
- Using Carry-Forward Concessional Contributions
We utilised Joe and Jane’s unused concessional contribution caps from prior years, allowing them to make large deductible contributions and offset taxable income.
- Joe contributed $132,500, and Jane contributed $126,072, generating a combined tax saving of approximately $89,198.
- Applying the Small Business Retirement Exemption
Joe qualified for the small business retirement exemption, enabling him to contribute $122,984 to superannuation. This contribution effectively reduced the capital gain on the farm by the same amount, meaning no capital gains tax was payable on the sale. - Maximising Non-Concessional Contributions
We made $120,000 non-concessional contributions each in the 2024/25 financial year, followed by the bring-forward rule in 2025/26, allowing $360,000 each in additional contributions.
This strategy enabled Joe and Jane to move substantial assets into the tax-free superannuation environment, where investment earnings and future withdrawals can be more efficiently managed.
Across concessional, non-concessional, and retirement exemption contributions, we helped the couple move over $1.2 million into superannuation within two months.
- Commencing an Account-Based Pension
Once contributions were complete, we established an account-based pension for Joe, allowing him to start drawing a tax-free retirement income while keeping his superannuation invested for growth. - Investing Surplus Cash
With the remaining sale proceeds of $1.35 million, we set up a joint investment account under a 30/70 portfolio allocation (70% defensive assets such as cash and bonds, and 30% growth assets like equities and property).
This balance provides a better return potential than cash alone while maintaining capital protection and mitigating inflation risk.
The Outcome
Through a combination of tax efficiency, strategic super contributions, and disciplined portfolio design, Joe and Jane achieved the following outcomes:
- $89,198 in immediate tax savings via concessional contributions.
- Elimination of capital gains tax on the sale of the farm.
- Over $1.2 million invested in superannuation within two months.
- A diversified investment structure designed to preserve capital and provide stable, inflation-adjusted returns.
- A tax-free income stream through Joe’s new account-based pension.
This case highlights the powerful intersection between tax strategy, superannuation planning, and behavioural coaching. By guiding Joe and Jane to see beyond short-term security and into long-term opportunity, we helped them transform a one-time windfall into a structured, sustainable, and tax-advantaged wealth plan.
For individuals selling a business or large asset, understanding the strategic use of concessional caps, small business concessions, and non-concessional contributions can make the difference between a simple cash deposit and a lasting financial legacy.