Inheritance tax planning
Inheritance Tax
Post-Death Planning
Client A had passed away and had an Inheritance tax bill of approximately £1M. Fortunately we were within the statutory time limit to vary the intestacy to reduce the tax bill to Nil.
Comment: Post-death planning should be done as a last resort as the options available to save tax are far less. However, if you are in this position then this tax planning invaluable.
Pre-Death Planning
Client B owned an estate worth around £4,000,000. The Inheritance tax at current rates would have been approximately £1,340,000. Shipleys Tax reorganised his affairs by converting a substantial non-qualifying asset into one which qualified for 100% business property relief, thus removing the inheritance tax liability and ensuring asset protection.
Comment: We would suggest that you review your current Inheritance tax exposure, this will quantify the issue and then if need be, plan to mitigate this tax. There are a number of ways to do this pre-death and these are very cost effective especially against many of the insurance products on the market.
Latest news & blogs…
Mortgage lenders accepting an SA302 tax calculation
Self-employed clients may have difficulty proving their income when applying for a mortgage. To this end, HMRC have published details of mortgage providers and lenders who accept either a copy of the tax calculation (SA302) printed from the HMRC online account or a tax calculation printed from commercial software used to submit returns. The lenders also require a tax year overview which can be printed from the HMRC account.
The list of lenders who have agreed to accept tax calculations and tax year overviews that customers or their agents or accountants have printed is available on the Gov.uk website at www.gov.uk/government/publications/mortgages-providers-and-lenders-who-accwpt-a-sa302-tax-calculation-or-tax-year-overview.
Further interest rate restrictions for landlords
Over the past few years the way in which landlords have been able to obtain relief for interest and other finance costs has been changing. The system of relief is moving from one of relief by deduction – which applies for 2016/17 and earlier tax years – to one under which relief is given as a basic rate tax reduction. From 2020/21, relief will be given in full as a basic rate tax reduction. Transitional rules apply for 2017/18 to 2019/20 inclusive as the changes are phased in, with some interest costs relieved by deduction and the balance as a basic rate tax reduction. For 2019/20, 25% of the interest costs can be deducted in computing profits, with relief for the remaining 75% being given as a tax reduction at the basic rate. Check with Shipleys Tax that you are obtaining relief for interest costs in the correct manner.
Call on 0114 275 6292 or email info@shipleystax.com.
Making Tax Digital For VAT – Update
MTD goes live
Making Tax Digital (MTD) for VAT went live from 1 April 2019. It applies to businesses with VATable turnover over the VAT registration threshold of £85,000 from the start of their first VAT accounting period on or after 1 April 2019, unless they fall within one of the categories of businesses with more complex affairs (such as those in a VAT group) in respect of which the start date is deferred until the start of the first VAT accounting period beginning on or after 1 October 2019.
Under MTD for VAT businesses must keep digital records and file their VAT returns digitally using MTD-compatible software.
Speak to Shipleys Tax to check what you need to do to comply with the requirements of MTD for VAT.
Call us on 0114 275 6292 or email info@shipleystax.com.
Testimonials
“We value the close working relationship we have with Shabeer and the specialist teams at Shipleys Tax...(read more)
Dr K, GP Surgery – Yorkshire
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FM Medical Practice – Manchester
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