Phil was looking to make some investments for capital growth through the purchase of residential properties. We demonstrated how he would be paying over £10,000 additional income tax. As such we structured a property investment strategy that provided a tax relief on the money he invested. The income generated and capital growth of the investment was also tax free.
The owners of Optimise Accountants also invest in property. They purchased an office for their business. The clever aspect of this is that the business made a pensions contribution, which is a costs against the business to reduce its corporation tax, to buy the office in their personal pension pots. Now they have a reduced tax liability and each year can charge the business rent. Once more the rent costs reduces corporation tax for the business and the income generated from rent is tax free within the pension. The owners of the business and its employees walk the talk.
Alex, an additional rate tax payer, invested in commercial properties and House of Multiple Occupancy (HMO's). Through the use of capital allowances able to eliminate the £5,00 income tax on the property portfolio and get a cheque back from HMRC for nearly £35,000 because of the capital allowances claim?
The 2015 budget announcement surely had a major impact on the tax situation for the majority of our clients. Most people are not aware that the budget announcement has increased their tax bill by over 35%-80%. We work with our clients in a pro active way to ensure that a new tax efficient structure is put in place to mitigate the budget announcement altogether.