Stating the obvious?

31st of January, means ‘tax deadline’.

For those completing their own self assessment form this is the last day that the forms and payment can be with Her Majesty’s Revenue & Customs (HMRC).

There is the strike that has been in the press, but I wouldn’t use that as an angle to get a couple of extra days in, as it could cost you a penalty of £100 and the interest on any tax due.

HMRC will also fine you if the detail is inaccurate, £100.

If you can’t find the paperwork for interest payments over the year, or how much you have paid into pensions, a useful place is to do it on line with the provider. Register with them and you can then access the information quickly. You could call the bank or pension company and you may get the info, it’s 11th hour and they are busy/busting at the seams on the last few days, but always worth a try.

ISA’s don’t go on the forms, I say this as sometimes there can be confusion as individuals take an income/withdrawal from their ISA’s and may think that this has to go on the self assessment form, don’t worry, it doesn’t.

Overpay the revenue? Some say that if you are unsure of the amount of tax, then pay a little more than you think. You can then reclaim the monies from them by requesting a repayment, or if you are feeling liberal you can always designate a charity of your choice for any monies due back.

If in doubt, give your local tax inspector a call.

Johnny

Happy, healthy & prosperous 2007!

Well, I hope you all enjoyed the holiday period and for me, it feels like a long long time ago that we were out on our Christmas do and enjoying the festivities.

Anyway, New Year, new start and all that. So, what should you be looking to do in the run up to the end of the tax year? Below, I have put a few ideas and suggestions that maybe worth considering.

The tax year end is 5th April and in reality, much of the tax planning needs to get under way now. The 5th falls on a Thursday, so for desperate last minute ISA & Pension contributions, we’d like them the week before, but in reality to guarantee we get them in for 2006/07, then Wednesday 4th has to be the last day!

ISAs - £7,000 maxi ISA. Anyone with £7K kicking around (spare) should consider one! Please take advice before you put any money away. There are thousands of different ISAs with risk ratings at every point on the scale. It is obviously vital that you know what you may be getting yourself into.

Pensions – SIPP’s, personal pensions, Stakeholders, whichever model suits your circumstances, they are all still pensions and with the increased possibilities for lump sum contributions post A-Day (06/04/06), pension planning must be near the top of priorities for investors with some spare capital. 40% tax relief (for higher rate tax payers) makes the investment into pensions still a very attractive form of saving for retirement.

Inheritance Tax (IHT) Planning – If you have a potential problem, don’t forget to use your annual gift allowances to reduce your taxable estate wherever this makes financial sense. Don’t forget that you can also use the £3,000 allowance for last year too. It’s basic, but for grandparents looking to move monies on to their grandchildren, it’s sensible. And, with the facility to pay £3,600 into a youngster’s pension each year, they can be combined as part of sensible tax planning. A net contribution of £2,808 gives a grossed up figure of £3,600.

It could also be an opportune time to revisit Wills and estate planning. This may mean the transfer of ownership of properties from joint ownership to tenants in common, using up the Nil Rate Band and many other aspects. Talk to us - if you don’t have a solicitor, we can refer you to an expert that will be able to assist with your queries.

There are also some bespoke tax solutions that we have for investors wishing to pass monies to grandchildren, and, with Accumulation & Maintenance Trusts changing so drastically post budget, we may now have a solution for this that is available to our clients. We have counsel’s opinion and should our clients or introducers wish to view this, please contact me and I can forward this on.

Specialist tax planning – Speak to Michael Coulson-Tabb. There are various planning and tax saving ideas that Michael has available and it would be worth consulting with him for tax planning. Give him an e-mail m.coulson-tabb@morgans.co.uk or call 0207 491 5060. You could also have a look at this weblink :- http://www.morgans.co.uk/financial_solutions.html

Mortgages – they may not be tax sensitive, but it’s crucial that you / we are proactive in ensuring that you get the best rates out there. Jane Robertson can and will help take some of the pain away of the re-mortgage, buy-to-let, overseas mortgage and your home reviews. Speak to her. J.Robertson@morgans.co.uk

Other ideas? – The New Year is a good time, or at least it feels like a good time to get the ‘financial’ house in order. Have a look at the life cover, is it enough? Is the mortgage covered? Review the existing pensions, existing investment portfolios, are they balanced correctly? Overweight or underweight in certain sectors?

Consider a financial review and enjoy 2007.

Best regards,

Johnny