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Tax Advice And Planning

Tax savings

Although HM Revenue & Customs (HMRC) has helplines available to assist taxpayers, staff members are not tasked with providing advice on how to organise your affairs in order to minimise the amount of tax you pay.

If you are looking to make tax savings but do not want to attempt to interpret detailed tax legislation, you should seek professional advice. We offer all clients tax planning reviews and try to ensure that our clients only pay as much tax as they are legally obliged to and no more!

Whatever your tax planning needs we will endeavour to find a tax saving scheme to suit your circumstances so make sure you contact us, especially as there may be more specific tax planning tips and tax advice available for your business sector.

We have included a series of tax tips below which provide general guidance on various tax saving strategies and should answer some of your tax questions.

R&D tax credits

Research and Development (R&D) reliefs support companies that work on innovative projects in science and technology. It can be claimed by a range of companies that seek to research or develop an advance in their field. It can even be claimed on unsuccessful projects.

You may be able to claim Corporation Tax relief if your project meets HMRC definition of R&D.

For further information please contact our team

SEIS/EIS

SEIS: This scheme is designed to help your company raise money when it’s starting to trade. It does this by offering tax reliefs to individual investors who buy shares in your company.

EIS: Like SEIS, this scheme helps your company raise funds by offering tax reliefs to individual investors. It is designed to help you grow your business.

With both schemes, there are rules that must be followed so that your investors can claim and keep the tax reliefs relating to their shares. The shares issued must meet the same requirements under both schemes. They must be paid up in full, in cash, on issue and must be full risk ordinary shares which

  • are not redeemable
  • carry no special rights to your assets

Risk-to-capital condition, this applies to both schemes. HM Revenue and Customs (HMRC) need an
explanation of how the investment in your company meets the condition, which means:

  • your company must use the funds raised for growth and development
  • the investment should carry the risk that the investor will lose more capital than they are likely to gain as a net return

How the schemes work

SEIS

  • you can receive a maximum of £150,000
  • this maximum will include any other de minimise state aid received in the 3 years up to and including the date of the investment, and
  • counts towards any limits for later investments through other schemes 

EIS

  • you can raise up to £5m each year, and a maximum of £12m in your company’s lifetime, including amounts raised under other schemes
  • your company must receive investment under the scheme within 7 years of its first commercial sale
  • special rules apply to knowledge-intensive companies that extend time and investment limits

Tax reliefs will be withheld, or withdrawn, from your investors if you do not follow the rules for at least 3 years after the investment is made.

Advance assurance

You can ask HMRC if your share issue is likely to qualify before you go ahead.  We can help you with this process. The wording of the risk-to-capital condition narrative is particularly important and we have a track record of getting this right.

Compliance

When you’ve issued your shares, you must complete a compliance statement. Again, we can help you with this process.

Capital gains tax

There are many common assets that can be subject to Capital Gains Tax (CGT) when they are disposed of, such as stocks, bonds, precious metals.

The legislation for CGT is a very complex area. There are many reliefs and exemptions which may lead to significant tax savings. It is therefore recommended that you seek the advice of MoneyWize Accountants & Tax Advisors, who will be able to prepare your CGT computations, claim any reliefs that you may be entitled to and calculate any liability that may be due.

If you are considering selling a personal asset or all or part of your business, we can advise you of the tax planning opportunities available to you before you make your disposal, in order to mitigate or reduce potential tax liabilities.

Inheritance Tax planning

At present, inheritance tax rate is 40 percent on the whole of an estate at death, so a failure to plan can leave a substantial and needless dent in your legacy which was built over the years.

There is normally no inheritance tax to pay if either, the vale of your estate is below the £325,000 threshold, or you leave everything above the £325,000 threshold to your spouse, civil partner or a charity.

If the estate value is below the threshold you will still need to report it to HMRC.

Don't leave it too late

Many of us talk about our eventual demise but never actually find time to prepare a will. Not having a will and clear instructions regarding distribution of your estate can result in assets passing to the wrong person or can give rise to an unnecessary large IHT bill.

Estate planning can save you huge amount of tax. Taking actions early means you can have full control of how you would like your estate to be distributed to the rightful beneficiaries.

There are various ways to reduce your inheritance tax bill:

  • Making a gift to your partner
  • Give to family members or friends
  • Put things into trust
  • Leave something to charity
  • Take out some life insurance policy

Get more information about our Tax Advice And Planning services

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