Tax Planning

Tax planning can appear complex and confusing. It is.

We aim to give you a complete understanding of all the issues that need to be addressed. Individual circumstances and requirements are carefully assessed and tailored solutions presented in easily accessible terms.

We have a range of strategies to help reduce taxation burdens, whilst at the same time building future wealth. Essentially, to achieve tax reliefs/reductions one must gift or make a legitimate trading expense or contribution to investment. It is this reduction in profit or income that reduces corporate or personal taxable earnings. It is therefore crucial to understand not only the various rates of tax but also how to apply investment to maximise personal benefit.

Key taxation rates that you should be aware of include:

Personal Tax

  • Personal allowance. £7,475 (under 65) £9,490 (65-74) £10,090 (>75).
  • Loss of Personal Allowances at the rate of £1 in every £2 earned above £100,000. Personal allowance (£7,475) lost entirely with gross income of £114,950.
  • Tax rates. 20% (< £35,500). 40% (£35,500 - £150,000). 50% (£150,000+)
  • Dividends. 10% < £35,000. 32.50% < £150,000 (25%). 42.50% > £150,000 (32.50%)
  • Capital gains tax. Annual exemption £10,600. Tax rates at 10%, 18%, 28%. (Trustees annual exemption increases to £5,300).
  • Inheritance Tax. Nil rate band £325,000. Tax on excess @ 40%, 36%, 20%.

Corporate and Business Tax

  • Corporation tax rates. 20% (<£300,000). 26% (>£1,500,000)

National Insurance

  • Employer. 13.80%
  • Employee. 12% (LEL-UEL). 2% (UEL+)
  • Salary payable without any NIC. £7,072.

Keeping up with the implications of tax changes and Budget announcements can be time-consuming.

  • Distributing Limited Company income in a tax efficient manner is also a delicate balancing act, complicated further by IR35 rules