Taxing Times 4 Article Discussion Area

johnllew

Pet48 wrote: »

My husband had to retire early due to ill health, he now claim carer's allowance for me as I am registered disabled. I have BT shares, and he has Friend's Policy share. I have noticed that when the bonus is paid into our bank account in relevance to these shares, there is always a tax deduction.
How do we register for this to be avoided please?

You can't. It's a notional amount of tax attached to a dividend which is not repayable.

annefromantrim

My great aunt inherited money when her sisterdied last year
She wants to give my daughter5000 pounds
My daughter pays the 20% incometax on her starting salary in the catering trade
Will she have to pay tax on this gift?

ajbisgr8

No, however should your great aunt pass away in the next 7 years the sum will form part of her estate for inheritance tax purposes and be liable for IHT should the total of the estate be above the IHT threshold. Any IHT however will be met from the estate - your daughter will not be personally liable.

If your great aunt does not pass in this time, the sum will not form part of the estate and no tax will be payable from anyone.

kidmugsy

"She wants to give my daughter5000 pounds": if the great aunt's gifts of capital in the present tax year and the previous tax year total £6000 or less, they'll be exempt from Inheritance Tax.

Plus she's also allowed to give unlimited gifts from capital of up to £250 pounds per recipient (except for recipients who're already covered by the £6k threshold mentioned above).

John_Pierpoint

There is no tax on the recipient of gifts, when they receive them.
There could be tax on the person or organisation making the gift.
IHT stands for InHeritance Tax.
If an individual has a net wealth worth more than £325,000 (the nil rate band) then their estate pays 40% on the excess. Unless they have inherited an unused percentage of a spouse/legal partner's nil rate band. In this case they may have an effective nil rate band for the second death of £650,000.
At death the gifts in the last 7 years are taken off the nil rate band before the rest of the estate gets what is left, so nobody will be coming after your daughter for belated tax.
Of course we don't know if the aunt is showering her other relations with gifts at the same time but two cheques of £2,500 are unlikely to attract much interest in (say) 6 years time.

rjeffriesbob

The cessation of self employment box on my 2006-07 tax return was never ticked .(Never trust that your friendly accountant fills in your return if you just sign at the bottom!!). I have phoned written and e-mailed H.M.R.C., collector and inspector for an answer to this problem and am now left with a low tax code while this is deducted from my wage. Can anyone tell me will I be able to post a cessation date this far on and if so where do I start?

rjeffriesbob

Sorry the deductions I am paying are for late returns that I had no need to fill as far as I knew at the time. Having paid an accountant to finalise and submit the years return and end my self employment, I stupidly thought there was no need. I have also chased up the accountancy to find they keep no record from that far back and have since turned everything to disc so no paper history.