2009/2010 Tax Saving Opportunities

its not very long before the ending of the tax year comes near. It is very important to make the most of any allowances and tax breaks that are .
By using the exemptions and allowances you might bring down your tax bill substantially. This can ordinarily be done quickly and easily with the assistance of a financial adviser.

Tax effective investments

Individual savings accounts
Individual Savings Accounts (ISAs). If you are aged over 50 your Isa allowance for the current 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 in up to £3600 gross each year and obtain basic rate tax relief on the payment made. Higher rate taxpayers can claim the remainder on their self assessment.

Capital Gains Tax Opportunities

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

Income Tax Planning

Each person can have a personal allowance of 6475 without acquiring any income tax. For espoused pairs or civil partnerships, where one is a high rate taxpayer it is worth 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 keeping down your liability to income tax.

Saving IHT

An individual can make an IHT exempt gift each year of up to Three thousand pounds in a tax year. Any unused exemption can be carried forward for 1 year only. If you are capable to make gifts out of income without it affecting your standard of living you might be allowed to make gifts above the annual exemption level.

If you believe your estate could be above the IHT nil rate band then efficient tax planning can be applied to cut back your estates possible IHT liability. This could be a appropriately drafted will or alternatively trust provision.

Consilium Asset Management are Financial Advisors based in Bristol, South Gloucestershire.

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