Kirkpatrick & Hopes - Succession Planning Accountants

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Tips and ideas to help you stay ahead of the tax man

Use your ISA allowance
If you have ISAs make sure you top up to the £15,240 limit before the 5 April 2016 whether this is for savings or for stock and shares.  A top tip would be to transfer any normal shares into your ISA to utilise the allowance.

Use your capital gains tax allowance
Everyone has an annual capital gains tax (CGT) allowance – £11,000 in the current tax year. This means you can sell or otherwise dispose of assets, such as stocks and shares, to realise this £11,000 worth of gains. You could then re-buy those stocks afterwards thus increasing the base cost of the shares.

Give away money
Inheritance Tax (IHT) is due if a person’s estate is worth more than £325,000 when they die. Currently IHT is charged at 40% on anything above this threshold.

But you’re allowed to gift £3,000 a year without attracting any IHT while you are still alive.

Dividends
Rules are due to change on 6 April 2016 – have a look at Andy Scott’s blog for more detail.  Do get in touch if you would like to discuss making additional dividends under the current rules, with potential tax savings possible.

Make Your Donations
Make sure you get any planned charitable donations in before the end of the tax year; there are potential tax savings available for higher rate earners. 

Pension Contribution
Higher rate tax payer with a full salary?  There are potential tax savings of an additional contribution that could be beneficial, and with the Tories likely to continue to attack annual pension allowances in the Budget, this could be well worth doing before the tax year is up.

Keep an eye on the Budget
The Budget will be finalised on the 16 March 2016.  As always we will be paying close attention to the things that will affect you, so please keep an eye on our blogs for related articles in the coming weeks and next month’s newsletter.

Invest in small companies
Venture Capital Trusts (VCTs) and EIS can provide tax relief of 30% of the investment made and can be worth considering if you are interested in investing in helping new businesses.

Please get in touch with us in you would like to explore the tax consequences of any of these planning tips in greater detail.

Please note that although these ideas carry tax saving benefits some would be regarded as investments and as such carry associated risks, it is worth consulting with your  investment advisor to ensure that the planning technique is suitable for you.

Robert Dunn

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