Tax Planning for Doctors in Australia – Ultimate FAQ Guide

About Nobilis Medical Accountants

1. Why should doctors use a specialist medical accountant?

Medical professionals face unique taxation, structuring, asset protection, payroll, GST, and compliance challenges. A specialist medical accountant understands the healthcare industry and provides advice tailored specifically for doctors.

2. What services does Nobilis Medical Accountants provide?

We assist with:

  • Tax returns
  • BAS and GST compliance
  • Tax planning
  • Family trusts and company structures
  • SMSF setup and compliance
  • Medical practice advisory
  • Bookkeeping and payroll
  • Asset protection
  • Investment structuring
  • Australia–India cross-border tax advice

Starting Private Practice

3. When should I move from PAYG employment to private practice?

The decision depends on your expected private income, practice opportunities, risk profile, and long-term goals.

4. Can I operate under my own ABN?

Yes. Many doctors start under their own ABN before progressing to more sophisticated structures as income increases.

5. When should I consider restructuring?

Typically, when:

  • Income exceeds $250,000–$300,000
  • Asset protection becomes important
  • Family income planning opportunities arise
  • You intend to build a medical practice

Business Structures

6. Should I operate as a sole trader, company, or family trust?

This depends on:

  • Income levels
  • Asset protection needs
  • Family circumstances
  • Future business plans
  • Investment objectives

7. Why do many doctors use family trusts?

Family trusts can provide:

  • Asset protection
  • Income distribution flexibility
  • Succession planning benefits
  • Long-term wealth creation opportunities

8. Why do doctors establish service companies?

Service companies can assist with:

  • Administration functions
  • Employing staff
  • Practice management
  • Business expansion

9. Can I change my structure later?

Yes. Many doctors start simple and restructure as their circumstances evolve.

Tax Planning

10. How can doctors legally reduce tax?

Common strategies include:

  • Superannuation contributions
  • Trust structures
  • Income distribution planning
  • Asset protection structures
  • Investment planning
  • Timing of expenses and income

11. What is the biggest tax mistake doctors make?

Waiting until June to start tax planning.

12. When should tax planning start?

Ideally throughout the year, with a formal review before 30 June.

13. How much tax should I expect to pay?

Tax varies based on:

  • Income
  • Structure
  • Deductions
  • Investments
  • Superannuation contributions

Superannuation & SMSF

14. How can doctors use superannuation to reduce tax?

Super remains one of Australia’s most effective tax planning tools.

15. Can I use unused concessional contribution caps?

Yes, subject to eligibility requirements.

16. Should I establish an SMSF?

An SMSF may be suitable if:

  • Combined super balances are significant
  • You want greater investment control
  • You are considering property investments

17. Can an SMSF buy property?

Yes, provided all superannuation regulations are satisfied.

Property & Wealth Creation

18. Should I buy an investment property personally or through a trust?

The answer depends on:

  • Asset protection requirements
  • Future income distribution
  • Capital gains expectations
  • Borrowing considerations

19. Should I buy shares personally or through a company?

This depends on:

  • Marginal tax rates
  • Investment horizon
  • Capital gains expectations
  • Future wealth extraction strategies

20. I have $250,000 retained in my company. Should I invest through the company?

Possibly. However:

  • Companies do not receive the 50% CGT discount.
  • Personal ownership may provide better long-term capital gains outcomes.
  • Company ownership may provide cash-flow and asset-protection benefits.

Professional modelling should be completed before investing.

Family Wealth Planning

21. Can my spouse work in the practice?

Yes, if:

  • Genuine duties are performed
  • Commercial remuneration is paid
  • Proper documentation exists

22. Can I employ my children?

Potentially, provided the arrangement is genuine and commercially reasonable.

23. What structures assist with intergenerational wealth transfer?

Common structures include:

  • Family trusts
  • Bucket companies
  • SMSFs
  • Testamentary trusts

GST & BAS

24. Are medical services GST-free?

Most patient medical services are GST-free.

25. Can doctors claim GST credits?

GST paid on eligible business expenses can usually be claimed through BAS.

26. Why am I paying PAYG instalments?

The ATO uses PAYG instalments to collect tax progressively throughout the year.

27. What happens if I miss BAS or tax payments?

Penalties and interest may apply.

Medical Practice Management

28. Should doctors be contractors or employees?

This affects:

  • Payroll tax
  • Superannuation
  • GST
  • Workers compensation
  • Employment obligations

Advice should be obtained before implementing arrangements.

29. What bookkeeping systems should doctors use?

Popular options include:

  • Xero
  • QuickBooks
  • MYOB

The best choice depends on practice size and complexity.

30. Do I need payroll software?

If you employ staff, payroll software is generally essential for STP and super compliance.

Asset Protection

31. Why is asset protection important for doctors?

Medical professionals face higher litigation and professional risk than many occupations.

32. What assets should be protected?

Common assets include:

  • Family home
  • Investment properties
  • Share portfolios
  • Practice goodwill
  • Intellectual property

33. Is insurance enough?

Insurance is important but should form part of a broader asset protection strategy.

International Tax

34. Do I need to declare overseas income?

Australian tax residents generally declare worldwide income.

35. Can I claim foreign tax credits?

Often yes, depending on treaty and foreign tax paid.

36. Can Nobilis help with India–Australia taxation?

Yes. This is one of our specialist areas.

37. How can I transfer money from India to Australia tax-efficiently?

Proper planning around timing, documentation, and tax treatment is essential.

Fees & Engagement

38. Can I switch accountants easily?

Yes. We manage the transition process and liaise with your previous accountant.

39. How much does a medical accountant cost?

Fees depend on:

  • Compliance requirements
  • Number of entities
  • Advisory requirements
  • Complexity of affairs

40. What is included in your tax planning meetings?

Typically:

  • Income review
  • Tax projections
  • Super opportunities
  • Investment planning
  • Structure review
  • Asset protection review

Doctors’ Most Frequently Asked Question

“What is the best structure to reduce tax and build wealth?”

The answer is never just about tax.

The best structure is one that helps you:

  • Protect your family assets
  • Build long-term wealth
  • Maintain flexibility as income grows
  • Support future investments
  • Prepare for retirement
  • Minimise tax legally
  • Allow future practice expansion

For most doctors, successful wealth creation comes from combining:

  • Appropriate business structures
  • Effective tax planning
  • Superannuation strategies
  • Investment planning
  • Asset protection
  • Regular annual reviews

The goal is not simply to pay less tax this year. The goal is to build wealth efficiently over the next 20–30 years.