Posted March 10th, 2010
In the 2009 Budget, Chancellor Alastair Darling announced measures that could hit anybody who earns more than £100,000. From April 2010, changes to the personal allowance, in conjunction with the introduction of a new higher rate tax band, are likely to cost even those near the bottom of these earnings levels an extra £2,500 a year. Furthermore, these measures were accompanied by a move to limit maximum pension contributions, which could add to the impact for those earning more than £130,000.
Targeting high earners
The measures are designed to see those who earn more contribute more to the repayment of the UK’s extraordinary debt levels. They include:
- a reduction in the personal income tax allowance for those earning more than £100,000;
- a new 50% income tax band (from April 2011) for those earning more than £150,000; and
- limitations on the tax rebates available on pension contributions.
Taken together, these measures mean high earners need to start thinking now about how to mitigate some of their impact. There are a number of things that can be done to help but, with time running short, you should start thinking now to make the most of this opportunity.
Getting help
If you would like to find out more about the measures and start making plans to limit their effects, we can help. Whether it is through pension planning, investment advice or simply assessing your salary level and tax position, we will take a close look at your financial situation and recommend solutions tailored entirely to your needs.
Give us a call today for a confidential chat - 01204 663904
Tags: 50% Income Tax Band, Allistair Darling, April 2010, Budget, Chancellor, High Earning Medics, Higher Rate Tax, Investment Advice, Pension Planning, Personal Allowance, Salary Level, Tax Position, Tax rebates | Posted in Taxation |
Comments: No Comments yet!
Posted January 20th, 2010
With a big budget deficit to plug (and without a hint of irony given their own expenses scandals) the government has now turned its spotlight on to professionals believing them to be not declaring all their earnings.
See the headline in 12 January’s Daily Mail here.www.dailymail.co.uk/news/article-1242497/Middle-class-medical-professionals-targeted-new-tax-clampdown.html#ixzz0d58v5Dtz
First up is medical consultants, surgeons, doctors and dentists. If this proves “successful” HMRC intends to target other professionals such as Solicitors and bankers.
They have proposed an amnesty to allow any untaxed earnings to be declared. This will be available for 3 months only and after 31 March they intend to be more aggressive.
Of course, you would be forgiven for thinking that this is not new. The Revenue has always had the power to open an aspect or investigate a tax matter should they wish. You may have personal experience of this or know of a colleague who has gone through this. If you do as a busy professional you will know it can be stressful, expensive and time consuming.
Perhaps an audit of your income and outgoings with a professional financial adviser specialising in your field would help.
If you are concerned about these issues and would like to discuss matters further in a confidential manner, please contact me on 01204 663904 or email advice@themedicalifa.co.uk
This comes hot on the heels of the increase personal taxation measures which come into force in April 2010, see here - www.themedicalifa.co.uk/taxation/what-the-proposed-taxation-changes-in-april-2010-will-mean-for-you
Tags: Amnesty, dentists, Doctor, expenses, Medical, medical consultants, Surgeon, Tax aspect, Tax investigation, Undeclared earnings | Posted in Taxation |
Comments: No Comments yet!
Posted July 16th, 2009
The government announced in April’s budget a number of major changes to the way they intend to tax high earners and their pensions. Of course, these changes may never come in but forewarned is forearmed.
To summarise, the proposed changes are:
1. The personal allowance will be restricted for people whose earnings are over £100,000. So for every two pounds they earn above that level, they will lose one pound in personal allowance.
2. This would mean that for someone earning over £113,000 per annum, there would be no personal allowance available.
3. A new top band higher rate of income tax of 50% will apply to incomes above £150,000.
4. The tax relief on pension contributions will be restricted from April 2011, for those people with incomes of £150,000 and over, and will reduce steadily until it is 20 per cent. That means the 40% tax relief will disappear completely once someone’s income hits £180,000.
Please note that this is all on top of the Lifetime Allowance issues which high earners have to contend with.
One simple way of reducing any tax burden at this level would be to make a gift aid donation to charity (which can even be backdated). This could create a potential win-win situation out of this changes.
If you wish to discuss any of the issues raised, please call us on 01204 663904 or contact us by email on advice@themedicalifa.co.uk
Tags: Budget, Charity, Consultant, Dentist, Doctor, High Earners, Higher Rate Tax, Lifetime Allowance, Personal Allowance | Posted in Taxation |
Comments: No Comments yet!