Year End Tax Advice
It s not very long before the end of the tax year nears. It is vitally important to make use of any personal allowances and tax breaks that are .
By using the annual exemptions and allowances you might possibly bring down your tax bill substantially. This can normally be done quickly and easily with the help of an independent financial adviser.
Tax effective investments
Individual savings accounts
Individual Savings Accounts (ISAs). If you are aged over fifty your Isa allowance for the actual tax year is now £10,200. ISA’s are free from capital gains tax, can be used to provide a regular income and are one of the most tax efficient investment vehicles that can be used
Pensions
Pensions are also a tax effective way of saving for retirement. Most people can pay up to £3600 gross each twelvemonth and obtain basic rate tax relief on the payment made. Higher rate taxpayers can claim the residual on their self assessment.
Capital Gains Tax Opportunities
If you have made profits on certain types of investment you may be able to use your annual capital gains tax allowance. This will let you to make gains up to this level without receiving a liability to pay tax. In many examples it is also viable to carry forward previous year’s losses.
Income Tax Planning
Each individual can receive a personal allowance of £6475 without incurring any income tax. For married pairs or civil partnerships, where one is a higher rate taxpayer it is worthwhile looking to see who owns the investments and potentially look to transfer assets into the
BR taxpayers name.Making gifts is also a means of cutting your liability to income tax.
Inheritance tax (IHT) planning
Every Person can make an IHT exempt gift each year of up to 3,000 in a tax year. Any unused exemption can be carried forward for one year only. If you are capable to make gifts out of income without it affecting your standard of living you may be allowed to make gifts over the yearly exemption limit.
If you consider your estate could be in excess of the IHT nil rate band then good tax planning can be applied to cut back your estates likely IHT liability. This could include a appropriately drafted will or instead trust provision.
Consilium Asset Management are Independent Financial Advisors based in Bristol.
If you are a ifa we have launched Financial Vision. Financial Vision supplies an IFA website design service to the financial services industry.
