Reviewing your tax arrangements to minimise liabilities is the
right step in enhancing your future financial security. Our team
have provided an overview of the tax saving opportunities for your
For couples, "shifting" income so that it accrues to
the partner with the lower tax rate in some circumstances is worth
taking into account. Some options are highlighted below:
Where couples who are married or in a civil partnership jointly
own an income-generating asset, each is taxed on 50% of the income.
So simply putting property into joint names can in some situations
save tax. However, this does not apply to dividend income from
jointly owned shares in close companies (broadly those owned by
five or fewer people) which is always split according to the actual
ownership of the shares.
If, for tax purposes, it is beneficial for one partner to be
taxed on all the income from an income generating asset, full
beneficial ownership must be transferred to them. This may give
rise to inheritance tax and capital gains tax implications,
particularly for non-married couples.
Introducing a spouse as a partner in a business or giving a
partner shares in a company will normally be effective in
"shifting" a proportionate share of income subsequently
Parents can transfer income-producing assets to an unmarried
child aged under 18, but the parent will be taxed unless the income
is less than £100 a year. Gifts by grandparents or gifts to
children aged 18 or more are not affected by this rule.
A parent can put money into a personal pension for a child. Even
if the child has no income, the parent can pay in up to
£2,880 a year, which becomes £3,600 with tax
We can assist in shaping strategies designed to enhance the
future financial security of you, your family and your
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Following the introduction of the disguised remuneration rules in 2011, HMRC promised to vigorously pursue existing employee benefit trusts on the basis of its long held view that income tax and National Insurance Contributions should have been paid when funds were allocated to an EBT.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”