Tax planning and advice
Although we will routinely consider tax planning opportunities when preparing a tax return or set of accounts, our clients also benefit from our experience and expertise throughout the tax year.
To be most effective, and to be as flexible as possible, tax planning should be considered long before a transaction is finalised. We proactively discuss our clients' tax affairs with them in order to ensure that any tax planning is considered at the earliest opportunity.
There are a number of tax-efficient investments available that an individual can use to reduce their tax liability. These can include pension contributions, investments under the Enterprise Investment Scheme (EIS) and Seed Enterprise Investment Scheme (SEIS), Venture Capital Trusts (VCT), Enterprise Zone Trusts and film partnerships. Where appropriate, we will work with our client’s own investment advisors to recommend the correct investment. We are also able to introduce Forum Wealth Management to provide expert financial advice.
We are acutely aware that just as no two clients’ affairs are the same, any tax planning undertaken will also be client specific. In such situations, we will work with the client to understand their aspirations and to ensure that key issues are clearly explained.
There are a number of reliefs available to reduce a charge to capital gains tax on a sale of an asset. These may include:
- Entrepreneurs’ Relief - this may be available when selling a business asset but the process involves a review of a client’s business interests many months, if not years, before a prospective sale in order to avoid any nasty surprises.
- Principal Private Residence (PPR) relief - with more people owning second properties, either as an investment or holiday homes, it is important to make sure that this often valuable relief is not overlooked.
- Claiming capital losses at the earliest opportunity.
- Deferring a chargeable gain by investing in a company qualifying under EIS or SEIS.
One of the decisions facing company owners concerns how best to extract profits from the business. The options include salary, bonuses, dividends, benefits and pension contributions. All of these can have different tax implications not only for the company but also for the director. We provide a comparison of the different scenarios, with the result that the overall tax payable need never be greater than it has to be.
With house prices having risen considerably in recent years, more and more people potentially face an inheritance tax charge on their death. Whilst it may not be possible to avoid tax completely, with careful planning it should be possible to reduce the eventual tax charge while at the same time maintaining a desired standard of living.
We have many years of experience helping clients reduce their exposure to inheritance tax. The planning undertaken has included:
- Reviewing business interests in order to ensure that Business Property Relief (BPR) is available, either at 100% or 50%.
- Advising on tax-efficient investments in order to obtain BPR, for example shares listed on the AIM.
- Advising on lifetime gifts, for example setting up trusts or making regular gifts out of income.
- Reviewing the spousal exemption and possible transfer of unused IHT exemptions.
- Considering taking out life assurance to fund the tax payable on death.
It is becoming increasingly common for individuals to spend time abroad during their working lives. For these expatriates, tax and social security issues tend to be more complex than for most. Such issues include registering for exemption from local social security contributions, studying Double Tax Agreements to determine taxing rights or establishing residency status. Membership of our international association IEC allows us to provide efficient and expert advice to our clients.
For more detail on how we would work to help you, contact Matt Bird and Paul Ffitch.