The Bot Bin

Saturday, February 13th, 2010

End of Year Tax Saving Opportunities

It s not long before the final stage of the tax year approaches. It is vitally important to make the most of any allowances and tax breaks that are .
By using the annual exemptions and allowances you might possibly reduce your tax bill substantially. This can ordinarily be done promptly and easily with the advice of a financial advisor.

Tax effective investments

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 investment vehicles that can be used

Pensions

Pensions are also a tax efficient way of planning for retirement. Most people can contribute up to £3600 gross each year and obtain basic rate tax relief on the payment. Higher rate taxpayers can claim the residue on their self assessment.

Capital Gains Tax Planning

If you have made profit on certain types of investments you may be able to use your yearly capital gains tax allowance. This will enable you to make gains up to this threshold without acquiring a liability to tax. In many cases 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 espoused couples or civil partnerships, where one is a forty percent taxpayer it is worthwhile looking to see who owns the investments and potentially look to transfer assets into the
basic rate taxpayers name.Making annual gifts is also a way of reducing your liability to income tax.

IHT planning

Each person can give an IHT exempt gift each year of up to £3000 in a tax yr. Any unused allowance can be carried forward for 1 year only. If you are capable to make gifts out of income without it altering your standard of living you may be allowed to make gifts over the yearly exemption limit.

If you think your estate could be in excess of the IHT nil rate band then effective tax planning can be utilized to cut your estates potential inheritance tax liability. This could be a suitably drafted will or alternatively trust provision.

Consilium Asset Management are Financial Advisers based in Chipping Sodbury, Bristol, South Gloucestershire.

If you are a ifa we have set up Financial Vision. Financial Vision provides an IFA website design implementation service to the financial service industry.

This entry was posted on Saturday, February 13th, 2010 at 1:27 am and is filed under Entrepreneurs, Internet Finance. 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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