Deposit

What are the tax implications for term deposits? Am I better off with shares or regular savings?

If I have a small pile of cash, is it better to put it into savings, term deposits, shares - of which i know nothing - or managed funds? I believe savings is 30% tax rate and shares capped at 15% but at the end of the day I'm completely new to investing ...

Public Comments

1. yes maybe not
2. do you have a bookkeeper? Ask him/her. Best bet.
3. Savings....pay taxes on interest every year. Stocks...pay on profits when you cash out (altho don't quote me). Certificate of Deposit IRA...don't pay taxes on interest until whenever you want and subtract amount of IRA from your income (up to $5000)
4. We as in old folks use to put it in a mason jar and put it barrie it in the ground , but theese days every one puts it in the bank , so go ahead and open a savins acount . ya know every thing is down theese days . also you can put it in a cd there you can leave it for a while . it will grow higher than the rest.
5. Interest income (such as savings accounts or term deposits) gets taxed at your marginal rate of tax. That could be 10%, 15%, 25%, 28%, 33% or 35%. Dividends (if they are Qualified Dividends) get taxed at 5% if you are in the 10% or 15% tax bracket otherwise and at 15% if you are in a higher bracket. If you invest in a managed fund, your tax position will depend on the investments the fund holds. If it invests in corporate bonds, for instance, you are going to get interest payments and it will be taxed as interest. Now, having said all that, never let the "tax tail" wag the "commercial dog." The most important thing is what makes you most money after taxes. Which would you rather have - a 4% investment that suffers tax at 15% or a 5% investment that suffers tax at 25%? The 4% investment yields 3.4% after tax. The 6% investment (even though you pay more tax) still earns 3.75% after tax.