The Blog

A Year End Tax Planning Tip

We are Cornwall Finance & Investment Services, our job is to assist our clients in creating, preserving and enhancing their wealth.

One of the ways we enhance wealth is by reducing the burden of taxation.

Transfer £50,000 and get £15,000 income tax relief!

If you are wealthy and have your bases covered (your mortgage paid, your emergency fund and school university fees settled and your dream holiday saved), you may well have a portion of your portfolio that you may be prepared to put at risk amongst the smallest of UK Smaller Companies. You may also have made your maximum contribution to pensions and could be facing a hefty Income Tax bill.

If this applies to you, you may wish to consider investing in, or, transferring your previous years Stocks and Shares ISAs. For example a sum of £50,000 placed into a Venture Capital Trust Individual Savings Account, (VCT ISA) means that a tax payer (usually higher rate) could claim up to £15,000 income tax relief to offset against income tax due.

Because it is in an ISA any gain will be free from Capital Gains Tax, because it is a VCT it needs to be held for a minimum of 3 years.

This is not an investment for the faint hearted; However it holds a place for those seeking growth over the long term and tax efficiency, investing in British businesses which are reaching for the stars.

We strongly recommend that you discuss this with an Independent Financial Adviser, such as ourselves, as there could be other strategies that may be more appropriate for you.  Photo courtesy of Octopus Investments and their excellent Octopus Titan VCT, recommended by us.

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