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Are you paying too much tax?

The tax legislation contains many allowances and reliefs that will help you to minimise your tax liabilities.  We recommend that our clients pay as much tax as they are legally obliged to pay, and no more!

Please find below some tax saving tips that you may find useful:

Employing spouse in your business
Savings and Investment
Husband & Wife transfers
Use of Own Car for work
Gifts to charities
Capital Gains tax and taper relief

Employing spouse in your business
If you are self employed and your spouse helps out with general administration, or any other type of work, it is quite legitimate to pay your spouse a salary.  You should always pay a market rate for the type of work done and number of hours worked. Sole traders with higher rate tax liabilities will benefit significantly from this arrangement.

Savings and Investment
Children and Savings - If you have significant funds invested in savings accounts in your own name, you may want to investigate sharing the investment with your children. There are Inheritance Tax planning matters to considert, but for higher rate tax payers this may be a lucrative tax saver.

Husband & Wife Transfers
Transfer shares and save tax  (married couples only).  It is possible to arrange shareholdings within your portfolio to save capital gains tax when you sell. You should take advantage of your annual capital gains tax free allowance and remember that transfers between husband and wife are capital gains and inheritance tax free! (Comments in this section to married couples also apply to partners registered under the Civil Partnership Act)

Use of Own Car for work
If you use your own car for business trips on behalf of your employer and you are paid a rate per mile which is below the Revenue approved rates you are entitled to make a claim on your tax return for the difference.

Gifts to Charities
A payment made to a charity under the Gift Aid regulations is fully deductable for tax purposes. Higher tax rate individuals will therefore save tax at 40%. If you are married and one partner is a standard rate taxpayer the other a higher rate taxpayer it makes sense for the higher rate tax payer to make the gift.

Capital Gains Tax and taper relief  - (for tax years prior to 2008/09)
Save Capital Gains Tax by claiming Taper Relief. The relief is available for assets owned on the 5 April 1998, or, purchased after this date. There is more tax relief on the sale of Business Assets compared to Non-Business assets, and the longer you own the assets the more Taper Relief you can claim. Business Assets that you have owned for 2 years or more will only attract a 10% rate of Capital Gains Tax if you are a higher rate tax payer. Non-Business Assets fare less well, but still after 10 years the most CGT you will pay is 24% of the taxable gain.


If you are unable to find a free solution to your query and require bespoke advice please use our Interactive Services.  These fixed fee services will provide you with cost effective email, telephone or face to face support solutions to help you come to grips with your problem; by using these fixed fee payment in advance processes you will always be in control of your cost exposure.

 

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Updated Daily: Monday July 14th 2008