From 6th April 2010 the following points maybe of concern to Higher Rate Taxpayers:-
- No increase to the £6,475 personal allowance and the basic rate tax threshold of £37,400.
- Up to 60% effective tax rate on adjusted net income between £100,000 and £112,950, as individuals at these levels of income will lose part or all of their personal allowance.
- A special annual allowance tax charge on pension contributions/accrual in excess of £20,000 or in certain cases £30,000 for people with relevant income of at least £130,000 in the 2010/2011 tax year or in either of the previous 2 tax years.
- 42½% tax rate on dividend income and 50% tax rate on other income over £150,000.
- From 6th April 2010 an effective restriction to higher rate tax relief on pension contributions/accrual for individuals with gross income of at least £150,000, or pre-tax income of £130,000 where the addition of employer pension contributions takes their gross income up to £150,000.
The main things to consider in order to potentially reduce your income tax liability are listed below:-
- Review your level and method of pension contributions.
- Invest in non-income producing investments.
- Make gift aid donations.
Stiles & Company Financial Services (Petersfield) Limited is a firm of Independent Financial Advisers dedicated to providing a highly professional service to our clients, spread predominately across Hampshire, Sussex & Surrey.
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