Reviews:

Do you know how much tax you pay and whether you are due any concessions in relation to Pension contributions, charitable contributions or an enhanced personal allowance?

Whilst for most of us, tax is deducted from our income by way of PAYE and from our savings and investments automatically (at basic rate), what you may not realise is that if you make a contribution to a Personal Pension, make charitable gifts or are of an age where you receive a higher personal allowance, you may be paying too much tax.
For the tax year 2011-12 everyone is allowed to earn £7,475 tax-free, for those over sixty-five, this increases to £9,940 and at seventy-five, to £10,090. However, for those earning over £24,000 per annum and over 65, the higher personal allowance is lost at a rate of £1 for every £2 of income. Pension contributions and charitable gifts reduce your taxable income when calculating your eligibility and income from ISAs is exempt.
Higher rate tax payers receive basic rate tax relief on their Pension contributions automatically but for Personal Pension contributions, higher rate relief must be claimed by way of a Tax Return.

Those with some of their personal allowance available can complete form R185 so that savings account providers will pay interest gross but for previous years, you will need to complete a tax reclaim.

If you need to complete reclaims, then to reclaim tax from the years ending 5 April 2006, 2007 and 2008, you must submit a return by 31 January 2012, 31 March 2012 and 5 April 2012 respectively. Therefore, there is a relatively small window of opportunity to claim back tax that may have been overpaid during these years. In addition, if you have sold shares over the last six years and have made a loss, to be able to claim this against any gains that you may make in the future, you must register the loss with Her Majesty’s Revenue & Customs.

If you would like us to review your tax situation and confirm whether a reclaim or returns might be appropriate, as well as considering whether there is any scope for reducing your tax burden, then please do contact the Office to book an initial appointment at our cost.

Philip J Milton & Company Plc
Tel: 01271 344300