Income Tax mitigation
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Income
Tax mitigation strategies are primarily concerned with avoiding income tax at the higher rate, currently 40%. The return on
attempting to avoid tax at the lower and basic rates are out of proportion to the effort.
Through the use of specialist
schemes, it is possible to mitigate all liability to income tax at the higher rate, and in some cases to obtain a rebate from
the Inland Revenue of all higher rate tax paid during the previous three years.
Whether income arises from earnings, the exercising of share options, property rental or interest payments, the higher rate tax liability may be mitigated entirely.
Strategies for Income Tax Mitigation
Some potential strategies for reduction of tax are listed below, but please contact us direct to discuss your own personal situation.
- Payments to approved Pension Schemes
- Investment into Venture Capital Trusts (VCTs) with income tax relief at 20% and dividends payable free of income tax
- Investments into Enterprise Investment Schemes (EISs) with income tax relief at 20%
- Investments into Enterprise Zone Trusts and Property Syndicates with tax relief at 40%. Non-recourse loans are available to reduce the risk for the investor
- Investments into Film Partnerships with tax relief at 40%, with loans available at up to 82% to improve cash flow
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