Tax Refunds

The Government, like them or loathe them, offers a number of ways to reduce tax and collect rebates.

I often discuss with my clients about how they can be creative with their pension to maximise savings. Or, how to double the value of your contributions - risk-free. If you are a higher earner, there are more ways to gain tax advantages, even if it may not seem so at first.

For higher earners, the amount that you can pay into a pension is less than a low or average earner. This is because of something called the tapered annual allowance, which reduces your annual allowance based on how much pension savings you have. Now, I’m sure there must be some logic to this, but I can’t see it.

However, there are ways you can avoid this, such as using carry forward. If applicable, this allows you to carry forward any unused allowance from the previous three tax years. A financial adviser can help you figure out if you can take advantage of this.

There are other investments that may benefit you, such as Venture Capital Trust (VCT), Enterprise Investment Scheme (EIS), and Seed Enterprise Investment Scheme (SEIS).

These offer between 30-50% tax relief and can be backdated (under certain circumstances) to get unused reliefs from previous years. However, they are a higher risk option and not right for everyone.

An adviser can assess if there’s an alternative that better matches your financial plan. Another use of an EIS is to defer capital gains incurred anytime within the last three years or a year into the future. It can also form part of your Inheritance Tax Planning without the usual seven-year wait.

Remember, when it comes to saving or regaining tax, there are many things to consider. All investments carry a risk - even if you structure them to be low.

These are complex financial topics, so it’s always best to do your research. Something you read may say it can do this or that – but can is not the same as will.

Our experts will always work with your best interest in mind, whether it’s on tax or other financial considerations you may have. Get in touch with our team today and see if we can help you prepare your perfect financial plan.

Please call us on 01480 869466 for a free initial, no obligation chat.

Future fees may apply.

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