Practolo Blog

Tuesday, February 2nd, 2010

Year End Tax Advice

its not long before the ending of the tax year approaches. It is vital to make use of any allowances and tax breaks that are .
By using the annual exemptions and allowances you could potentially reduce your tax charge considerably. This can ordinarily be done quick and easily with the help of a financial adviser.

Tax effective investing

Individual savings accounts
Individual Savings Accounts (ISAs). If you are aged over 50 your Isa allowance for the present tax year is now £10,200. ISA’s are free from capital gains tax, can be used to provide an income and are one of the most tax efficient investments available

Pensions

Pensions are also a tax efficient way of saving for retirement. Most people can contribute up to £3,600 gross each year and obtain basic rate tax relief on the contribution. 40% taxpayers can claim the residual on their self assessment.

Capital Gains Tax Planning

If you have made profit on certain types of investment you may be able to use your yearly capital gains tax allowance. This will enable you to make gains up to this amount without acquiring a liability to pay tax. In some examples it is also possible to carry forward previous year’s losses.

Income Tax Planning

Each individual can have a personal allowance of £6475.00 without incurring any income tax. For married pairs or civil partnerships, where one is a higher rate taxpayer it is worth looking to see who owns the investments and possibly look to transfer assets into the
basic rate taxpayers name.Making annual gifts is also a way of reducing your liability to income tax.

Inheritance Tax opportunities

Each individual can give an IHT exempt gift each year of up to Three thousand pounds in a tax yr. Any unused allowance can be carried forward for one yr only. If you are able to make gifts out of income without it affecting your standard of living you might be allowed to make gifts over the annual exemption level.

If you think your estate could be above the IHT nil rate band then efficient tax planning can be applied to cut back your estates likely inheritance tax liability. This could include a suitably drafted will or instead trust provision.

Consilium Asset Management are independent financial advisers based in Chipping Sodbury, Bristol.

If you are a financial advisor we have established Financial Vision. Financial Vision supplies an financial adviser website design implementation service to the financial services industry.

This entry was posted on Tuesday, February 2nd, 2010 at 10:27 am and is filed under Finance Information, Your Business. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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