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Tax mitigation products – maximise your tax-free allowance
It’s the time of year when many of us start planning for the next financial year, and begin looking at ways to reduce the tax bill.
Every year, the government sets new guidelines for sponsored tax mitigation schemes, including ISAs, Venture Capital Trusts (VCT) and Enterprise Investment Schemes (EIS). Following is a brief summary of some of the key products which you may wish to consider when looking to maximise your tax-free investment opportunities.
Individual Savings Accounts (ISAs)
ISAs are free of income tax and capital gains tax. There are maximum investment limits which apply for each tax year (currently £10,680 per person for 2011/12). However, your investment could build steadily over several years. An ISA can be taken in stocks and shares or cash.
Venture Capital Trusts (VCT)
VCTs involve investing in unquoted trading companies. Investors will potentially be exempt from tax on dividends and on any capital gain arising from disposal of the shares in the VCT. It is possible to subscribe to shares up to a value of £200,000 with a tax relief rate of 30%, provided the shares are held for at least five years.
Enterprise Investment Scheme (EIS)
EISs incorporate equity investments in unquoted trading companies. There have been changes to the EIS that make it more attractive as a tax saver. Companies may now obtain 30% tax relief on their investment (up from 20%), and the annual investor limit has doubled to £1 million.
As attractive and prudent as these products are, it is important to receive specialist advice. EIS, for example, is a complex scheme and investment opportunities for investors with a speculative attitude to investment risk must be carefully assessed.
Please get in touch today with one of PK Group’s specialist tax advisors to find out more about making the most of your tax-free investment opportunities.
About PK Group | http://www.pkgroup.co.uk
PK Group is a fast-growing, London-based, firm of financial architects.
As one of the leaders of the new generation of financial services companies, we are dedicated to using our financial experience and expertise to help grow and protect our clients’ businesses, income and wealth. PK Group solves the financial problems of individuals and companies by providing financial and tax planning, wealth management, accountancy and corporate finance services.
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http://www.pkgroup.co.uk or contact us on +44 (0) 20 8334 9953
The services of PK Group are conducted by PK Partners LLP, PK Financial Planning LLP and PK Corporate Finance LLP.
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Registered by the Institute of Chartered Accountants in England and Wales to carry out company audit work.
PK Financial Planning LLP is a limited liability partnership registered in England and Wales No. OC303592
PK Financial Planning is authorised and regulated by the Financial Services Authority