Australia taxes people, not households — so a couple has two tax-free thresholds and two sets of brackets. Hold your investments in the right name and the same income is taxed far less.
1The idea
Every individual gets the first $18,200 tax-free and climbs the same brackets. In a couple with uneven incomes, investment income piled on the higher earner is taxed at their top rate — while the lower earner's low brackets sit unused.
Move the income-producing assets — shares, ETFs, a savings account, a rental held in the right name — toward the lower earner, and that income is taxed at their rate instead. Two levers do most of the work: whose name owns the asset, and spouse super contributions.
This pairs with the shares lesson — franking credits refund the most in the hands of a low-rate holder.
2Who it's for
Couples with a real gap in incomes — one high earner and one on a low income, part-time, studying or at home.
You're about to invest outside super, so you can choose the owner from the start — no transfer needed.
Not for your salary. Wages are taxed to the person who earns them — you can't split your pay. This is about investment income only.
3The worked example
One partner earns $190,000, the other $30,000. A share portfolio pays $8,000 of dividends a year:
Held by the $190k earner (47%)−$3,760
Held by the $30k earner (18%)−$1,440
Saved every year, same shares+$2,320
Same portfolio, same $8,000 — just owned by the partner with room in the lower brackets. Repeat it every year and reinvest the saving, and the gap compounds.
4Try it on your numbers
Whose name should hold it?
Investment income /yr$8,000
Extra tax if Partner A holds it−$3,760
Extra tax if Partner B holds it−$1,440
Hold it in Partner B's name → save+$2,320/yr
Extra tax = the investment income stacked on top of that partner's salary, at FY2025-26 rates + 2% Medicare (franking credits and offsets not modelled). The asset must genuinely be theirs. Estimates only.
5The honest caveats
It has to be real ownership. The asset is bought with their money and legally theirs — a paperwork trick the ATO can see through doesn't count.
Moving existing assets triggers CGT. Selling or transferring shares to your partner is a capital-gains event — best done with new money, or with advice.
Not via the kids. Minors pay penalty tax on investment income, so shifting it to children doesn't work.
It's genuinely their asset — which matters if the relationship ends. Weigh the tax saving against that.
6How to action it
For your next investment, decide whose name holds it before you buy — usually the lower earner.
If your spouse earns under ~$37k, a spouse super contribution before 30 June can earn you up to a $540 tax offset.
Uneven super balances? Ask your fund about contribution splitting to even them up over time.
Thinking of moving existing assets? Take it to a registered tax agent first — the CGT can outweigh the saving.
General educational information, not personal tax or financial advice. Ownership, transfers and spouse-contribution rules have detail and anti-avoidance limits — confirm your specifics with a registered tax agent or at ato.gov.au. Figures are estimates for FY2025-26.