Tax & Trust Planning - Income Tax

The following points, whilst not exhaustive, may assist you in your tax planning. Should you wish further information or advice then please contact us.

• You can invest up to £7,000 per person in an Individual Savings Account (ISA) of which up to £3,000 may go into cash (which includes National Savings), up to £1,000 into life insurance and the remainder into stocks and shares.
  
  
• Pension contributions and additional voluntary contribution payments for the current year and the previous six years if there is unused relief.
  
  
• Venture Capital Trusts (VCTs). Investments of up to £100,000 (in qualifying UK unquoted trading companies) qualify for income tax relief of 20% of the amount invested, in share capital. Any income generated is tax-free.
  
  
• Enterprise Investment Schemes (EISs). Investments of up to £150,000 per tax year qualify for income tax relief of 20% of the amount invested. Any income generated is tax-free.
  
  
• Consider tax-free exempt National Savings or Friendly Society investments.
  
  
• Allowable capital losses on shares in unlisted trading companies can be eligible for income tax relief, as an alternative to capital gains tax relief.
  
  
• Another means of providing a tax-free income is to invest in Government stocks, at below par, with the intention of retaining them until redemption at par, thus guaranteeing a tax-exempt gain.
  
  
• An investment (either directly or via an enterprise zone investment trust) in an industrial building, in an Enterprise Zone, attracts a 100% initial allowance and is thus a useful tax shelter.
  
  
• The transfer of income producing assets between husband and wife may assist in using up the transferee's starting and/or basic rate bands and is particularly useful if the transferor is liable at the higher rate on such income.
  
  
• Click Here to go to the Income Tax Calculator.