New (Tax) Year Resolutions

Hazel Burt | 25 February 2020

New (Tax) Year Resolutions

If you are like me and have failed miserably with your New Year resolutions fear not there is still time to take action ahead of the new tax year starting on 6 April.

Here are some ideas you might want to consider:

Spouses or Civil Partners
Have both of you used your personal allowances or is one of you a higher rate tax payer? You might want to consider gifting income producing assets such as shares or property to the lower paid spouse. Alternatively, if you are in business, you might want to employ your spouse and pay them a commercially justifiable salary for the employment duties they perform.

Pension Contributions
There is still time to make a pension contribution before 5 April and secure some income tax relief. Even if you don't have any UK earnings it may be possible to contribute up to £3,600 a year (gross) into a scheme.

Changes for Residential Property Tax
It might be worth considering bringing residential property transactions forward.

Generally, the final period of ownership of a person’s home will be tax-free, irrelevant of whether it is actually occupied as such. From 6 April 2020 The final period exemption will be reduced from 18 months to 9 months.

In addition, there is a new reporting requirement on the sale of all UK residential properties from 6 April 2020. This would include residential investment property and also where a person’s home is partially exempt. In such situations a special return must be completed within 30 days of completion and also pay an estimate of the tax.

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