09/10 Tax Saving Opportunities
its not long before the final stage of the tax year approaches. It is crucial to make use of any allowances and tax breaks that are .
By using the exemptions and allowances you could potentially reduce your tax bill considerably. This can normally be done quick and easily with the help of a financial advisor.
Tax effective investing
Individual savings accounts
Individual Savings Accounts (ISAs). If you are aged over 50 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 an income and are one of the most tax efficient investments available
Pensions
Pensions are also a tax efficient way of planning for retirement. Most people can pay in up to 3,600 gross each year and obtain basic rate tax relief on the payment. Forty percent taxpayers can claim the residue on their self assessment.
Capital Gains Tax Planning
If you have made profits on certain types of investment you may be able to use your yearly capital gains tax allowance. This will let you to make gains up to this level without acquiring a liability to tax. In many cases it is also possible to carry forward past year’s losses.
Income Tax Planning
Each person can receive a personal allowance of £6,475 without acquiring any income tax. For wedded couples or civil partnerships, where one is a high rate taxpayer it is worthwhile looking to see who owns the investment and possibly look to transfer assets into the
20% twenty percent taxpayers name.Making gifts is also a way of reducing your liability to income tax.
Saving IHT
Every Person can give an IHT exempt gift each year of up to £3000 in a tax twelvemonth. Any unused allowance can be carried forward for one yr only. If you are capable to make gifts out of income without it changing your standard of living you may be allowed to make gifts above the yearly exemption limit.
If you believe your estate could be in excess of the Inheritance Tax nil rate band then effective tax planning can be applied to reduce your estates possible inheritance tax liability. This could be a appropriately drafted will or instead trust planning.
Consilium Asset Management are Financial Advisors based in Bristol.
If you are a independent financial adviser we have set up Financial Vision. Financial Vision supplies an financial adviser website design service to the financial services industry.
