As many of our clients can testify, our help with
year end tax planning can prove invaluable. This year,
several special situations require early attention.
Contact us for help if any of the following affect you:
| |
| Retirement
Relief |
| Business owners
who will have reached 50 before 6 April 1999, or
could qualify for early retirement on the grounds
of ill health can still benefit from full capital
gains tax retirement relief before it is phased
out. Check with us if you would like to arrange a
disposal of your business assets by 5 April. |
| |
| Investment
Strategy |
| Refunds of tax
credits on dividend income will no longer be
available after 5 April 1999. This could reduce
the income of elderly people or children whose
annual tax free allowance exceeds their income -
and it will affect any discretionary trust
currently receiving dividends. Investments
therefore require urgent review. |
|
|
| Taxation of
professions |
| The new rules
replacing professional firms' 'cash basis' of
accounting with an 'earnings basis' and the
ten-year 'catch up' charge will affect the
calculation of taxable profits from 1999/2000
onwards. |
| |
| You must prepare
now for the requirement that professional work in
progress must be valued on a 'true and fair
basis'. Full debtors, less any deemed
irrecoverable, must be included in your annual
accounts. You may also identify and finance a
'catching up' charge. |
| |
| Inheritance tax |
| It may only be a
question of time before the Government tightens
up on inheritance tax by, for example, reducing
the 100% relief of gifts on business assests. We
advise you to consider how to optimise your
position ahead of any possible changes. |
| |
| PEPs, TESSAs,
and ISAs |
| Review your
savings and investments arrangements, |
|
|
especially
with regard to past and continuing contributions to PEPS
and TESSAs, well before the new Individual Savings
Accounts (ISAs) are introduced in 1999.
| |
| Risk of severe
penalties for employers |
| The Inland Revenue
and the Contributions Agency are devoting even
more resources to PAYE and NIC inspections,
usually following a review of forms P11D and P9D,
which cover non-cash earnings and benefits. |
| |
| You could receive
notice of an inspection at any time - and severe
penalties if you are in default - so take extra
care to ensure everything is in order. See our
article in page two. |
| |
| And finally... |
| As 1998 draws to a close, we
would like to thank all our clients for your
valued custom , especially those who have made
referrals to us during the year. We wish you
peace and prosperity for the New Year. |
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