Personal Tax Planning
tax-return form

Personal Tax Planning

Personal tax planning and advice for individuals.

A lot of people view tax as a horrible thing and is the last thing they want to think.

So quite often clients present us with their income and expenses information very close to the deadline; nine months after the year end.

You can’t change the past, you can only change the future

If you want manage your tax position effectively and make sure you’re not paying too much tax and find out if there’s a way to reduce your tax you need to do it in real time.

You cannot speak to an accountant in nine months after the end of the tax year to try and change the past because accountants are not magicians or time travellers.

What you need to do is look forward to the current tax year and find out how can you work with your accountant to try and position my income and my costs to make sure that I don’t pay more tax.

Over the last year you and your colleagues have handled my affairs quickly, efficiently and professionally. Nothing has been too much trouble.
You have always been there when I needed you, making the minefield of tax and accounts so much easier to navigate. And, of course, it is very re-assuring to know that, with your help, we are fully complying with business law and not paying a penny more in tax than we need to.
I am sure we will continue using you for many years to come.

First Coast Restaurant

Edinburgh

Example One

Make sure you’ve declared the right amount of dividends and declared the right amount of dividends, it’s either not going to take into higher rate tax or not lose your personal allowance when you go above £100,000.

Once you go above £100,000, the first £10,000 effectively paying 60% tax which is steep.

So for the sake of a pension contribution before the 5th of April of £10,000 you’re only putting £4000 into your pension and you’re getting £10,000 back.

So tax planning is very important.

And it will save you a lot of money.

Example Two

Another example of tax planning applies to limited companies as well.

Make sure you spend the money before the end of the year, because then you get immediate tax relief.

If you spend it two weeks after the year end or the tax year end you’ll be waiting 12 months.

Tax planning is absolutely critical as it’s the only way you’re going to manage your taxes properly.

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