Personal Tax

An Introduction to Self-Assessment The majority of people in the UK are taxed under PAYE and do not have to complete a Self Assessment tax return. However, where you have income that is not taxed at source or may be liable to higher rate tax on income that has only had basic rate tax stopped you will probably need to complete a self-assessment return.

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Child Tax Credit and Working Tax Credit The Child Tax Credit and Working Tax Credit are a key part of the Government's welfare policy which mixes up the tax system with the social security benefits system. The Government is also keen to reward those who are in work with extra benefits. These tax credits have nothing to do with the tax system. They are not refunds or credits of tax, but are simply benefits administered by HMRC.

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Enterprise Investment Scheme The Enterprise Investment Scheme provides for some significant income tax and capital gains tax reliefs for individual investors in unquoted trading companies. There are some very complex conditions which must be met for the tax reliefs to be given, so this helpsheet can only give a brief overview of how the various tax reliefs work.

Essentially the investors claim tax relief according to the amount they invest in new shares issued by the company under the EIS scheme, known as EIS shares.

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Family Tax Planning From the Arctic Systems case and Income Shifting to paying your children a wage.

  • Paying wages to your spouse/civil partner and children through your business
  • Making your spouse/civil partner a partner or shareholder in your business to reduce your tax bill
  • Income Shifting
  • Other relatives and non-married couples
  • Giving investments to your spouse/civil partner and children
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Individual Savings Accounts (ISA) The rules on investing tax efficiently with ISA's.

Tax Advantages of ISAs:

  • All income from the ISA is received tax free.
  • There is no capital gains on the investment.
  • Money is not locked in by the tax rules although some accounts will have notice periods. However, if you withdraw funds you will only be able to re-invest later in the same tax year up to the balance remaining on your investment limit.
  • They are not reportable to HMRC.
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Premium Bonds The advantages of premium bonds compared to the National Lottery.

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Seed Enterprise Investment Scheme (SEIS) Similar to EIS but more tax relief and aimed at smaller companies.

  • Tax Reliefs
  • Individuals Who Qualify For Tax Relief
  • The SEIS Company
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Tax-efficient Charitable Giving There are various ways in which you can give to charity tax efficiently which they allow the charities to receive more income. The charities will gain more from your gift if you donate through a designated scheme, such as payroll giving or Gift Aid.

  • Gift Aid
  • Give As You Earn
  • Other Donations
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Taxation of Buy to Let Properties Factors to consider in the taxation of the ever expanding market of rental properties including overseas property.

The income is treated as the profits of a Property Income Business.

If the owner of the property is an individual or a trust the profits are charged to income tax for the tax year to 5th April. If the owner is a company the profits are charged to corporation tax for the accounting period of the company.

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Venture Capital Trusts Venture capital trusts (VCTs) are very attractive from a tax point of view but they are a higher risk investment.

VCT's are HMRC approved investment companies that are quoted on the London Stock Exchange, which invest mainly in unquoted trading companies. The VCT allows private investors to invest indirectly in those smaller companies that are in need of financial backing, by purchasing shares in the VCT.

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