- Potentially reduce your company annual National Insurance liability by up to £4,000 by claiming the National Insurance Allowance
- Claim the £6 per week use of home as office allowance if you are an employee who has to work from home
- If your business does any R and D it may be eligible for tax credits
- The temporary £1m level of the Annual Investment Allowance (AIA) has been extended to 31 March 2023. This is available to any business investing in qualifying capital allowances (eg: office equipment).
- If you are employed by your company and need a phone for business consider buying it through the company, and having the contract with the company. Recharging personal calls is very difficult under fixed tariffs.
- Consider different ways you can reduce your taxable income such as pension contributions and salary sacrifice schemes (eg: cycle to work) – these need to be considered carefully but there are options to make a big difference.
- Managing your family taxable income is critical – for example, if either you or your partner earns more than £50,000 a year before tax, you’ll have to pay back some (or all) of your Child Benefit in the form of extra Income Tax and complete a self assessment.
- Beware of settlement rules, for example if you gift shares to your child who is a minor then income from the shares over £100 pa is treated as your income for tax purposes.
- Beware if you gift shares with a value over the CGT limit currently £12,300 (21/22) then you may have to pay CGT, there are exceptions or you may be able to claim Gift Hold-Over Relief if you give away business assets (including certain shares) or sell them for less than they’re worth to help the buyer.
- Dividend tax rates are increasing by 1.25% from 6th April 2022 – Consider if you should take dividends before rates go up but be aware not to trigger a higher tax bracket as rates higher
Current Income Tax rates and bands
The table shows the tax rates you pay in each band if you have a standard Personal Allowance of £12,570.
Income tax bands are different if you live in Scotland.
|Personal Allowance||Up to £12,570||0%|
|Basic rate||£12,571 to £50,270||20%|
|Higher rate||£50,271 to £150,000||40%|
|Additional rate||over £150,000||45%|
You can also see the rates and bands without the Personal Allowance. You do not get a Personal Allowance on taxable income over £125,140.
Plan ahead to avoid the new Plastic packaging tax that takes effect from April 2022, levied on plastic packaging containing less than 30% recycled plastic, with the tax charged at a flat rate of £200 per tonne.
Contact us so we can help you make the right claim for you.