Look out for Special Annual Allowance in your proposed pension contributions
Friday, June 12th, 2009This is an interesting one and follows on nicely from our my last blog.
Some clients have started to enquire if it is possible to offset the proposed income tax increase to 50%. I have detailed the points for this in the previous blog.
However, there is a new special annual allowance of £20,000. This will be applied to any savings made that exceed the normal pattern of your contributions. Savings over and above the £20,000 level will be taxed at 20% for 2009/2010 and 2010/2011. Although not yet finalised, on the introduction of the 50% higher rate tax level, this special tax charge may increase to 30%.
More details can be found in the HMRC document entitled: PENSION SCHEMES: LIMITING TAX RELIEF FOR HIGH INCOME INDIVIDUALS
SPECIAL ANNUAL ALLOWANCE.
This can be found here: http://www.hmrc.gov.uk/budget2009/pensions-technical-1550.pdf
Planning for pensions is key to ensure that the contributions that you make are as effect as possible.
Churchouse Financial Planning Limited is authorised and regulated by the Financial Services Authority
Tax & Pensions changes in 2010, start your planning now!
Thursday, June 11th, 2009Some clients have asked for clarification on the new pension changes proposed for the new tax year 2010 and thereafter.
Many will know that the government is proposing a new top tier tax rate of 50% for those earning over £150,000 per annum.
They are also proposing restrictions to the income tax allowances for those earning over £100,000 per annum, which will see these clients overall tax burden increase.
Also, from April 2011, tax relief on pension contributions will be restricted for those with incomes of £150,000 per annum and over, and the relief available tapered down until it is at a level of 20%, the basic rate tax level.
Churchouse Financial Planning Limited is authorised and regulated by the Financial Services Authority.
The New ISA Saving Rules 2009, October 06th 2009
Monday, June 8th, 2009Many people like to save for their future using their annual ISA allowance. In the past the maximum that can be saved into an ISA is £7,200 each year.
Tax efficient ISA savings have been successful and the offer to save using these vehicles is to be extended. This will be achieved as follows:
For the Over 50’s, the new allowance from 06th October 2009 will be a maximum of £10,200 pa, an increase of £3,000 in the current annual allowance (£7,200). If you prefer just to save into a cash ISA arrangement, this limit will increase to £5,100 pa, half the maximum stocks and shares allowance of £10,200 pa. If you have already used part of your allowance in this tax year (2009/2010), then you should be able to top up your ISA arrangement in October.
For the under 50’s, these new rules will apply from the new tax year, 06th April 2010.
This should see an increase in total savings in UK using these tax effecient methods.
Churchouse Financial Planning Limited is authorised and regulated by the Financial Services Authority.
