Tax Planning complicated

Penguin2017

Hi,

We moved to the UK a year back. I work a corporate job so fairly straightforward with salary and my spouse doesn't work.

I am beginning to find out options to save tax . It seems there are only 3 potential routes i.e.
a. Top up your pension up to the maximum limit , and include last year allowance
b. Use ISA to save on income interests, we dont have much saving here so not very relevant
c. Use some benefits i.e. Edenred vouchers

We reached out to a tax planner, and he suggested that we pay him £450 to help us plan the taxes. It seems high but wondering if we should do it, or is it really that simple?

Thanks for your advice on this

le_loup

Or just contribute to the society you have chosen to join and be pleased to pay your dues.
Happy Christmas.

Sarastro

le_loup wrote: »

Or just contribute to the society you have chosen to join and be pleased to pay your dues.
Happy Christmas.

People have individual as well as societal responsibility.

OP - pension contributions would be a very tax efficient thing to do.

xylophone

Or just contribute to the society you have chosen to join and be pleased to pay your dues.

No doubt he's paying his income tax and NI in the normal way?

Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes.
Judge Learned Hand, Helvering v. Gregory, 69 F.2d 809, 810-11 (2d Cir. 1934).

xylophone

I am beginning to find out options to save tax

Pension contributions can be tax efficient.

You might wish to consider a stocks and shares ISA.

http://www.childcarevouchers.co.uk/parents

https://www.gov.uk/help-with-childcare-costs/free-childcare-and-education-for-2-to-4-year-olds

Penguin2017

Thanks All, just to clarify, my tax is already deducted by the company. I am not avoiding tax, in fact paying a bit more since I had not saved pension or ISA

Voyager2002

Penguin2017 wrote: »

Hi,

We moved to the UK a year back. I work a corporate job so fairly straightforward with salary and my spouse doesn't work.

I am beginning to find out options to save tax . It seems there are only 3 potential routes i.e.
a. Top up your pension up to the maximum limit , and include last year allowance
b. Use ISA to save on income interests, we dont have much saving here so not very relevant
c. Use some benefits i.e. Edenred vouchers

We reached out to a tax planner, and he suggested that we pay him £450 to help us plan the taxes. It seems high but wondering if we should do it, or is it really that simple?

Thanks for your advice on this

From what you say, it is highly unlikely that the tax planner would be able to save you as much as s/he would charge you.

Remember that your spouse has a "personal allowance" (amount that one can earn without paying tax) so if this is not being used, explore how some of this can be transferred to you. HMRC would be pleased to tell you about this: best to telephone them at about 8 in the morning. And if your spouse were to have a small income (from a part-time job; from property or from investments) this would probably be tax-free as well).

Other than tax relief on pension contributions and on any growth in investments made within an ISA, the main tax relief available to you is on charitable giving. Whenever you give money to a registered charity, be sure to fill in the appropriate form. The charity will then be able to reclaim all the tax you paid on the money you gave to them.

Cook_County

Since you only moved to the UK a year ago; are you domiciled outside the United Kingdom? If you are, there is a considerable amount of income tax, capital gains tax and inheritance tax planning you might want to be thinking about.

Pennywise

Penguin2017 wrote: »

We reached out to a tax planner,

Please make sure they're properly qualified, either an accountant from a "chartered" accountancy body or a qualified tax adviser from the chartered institute of taxation.

Unfortunately, accountancy and tax advice isn't regulated in the UK and literally anyone can call themselves an "accountant", "tax advisor", etc., even if they have no qualifications etc.

You also need to ensure that they're not just trying to sell you some dodgy tax avoidance scheme, such as a loan scheme, trust scheme, etc., as HMRC are all over those at the moment.

badmemory

I agree with Pennywise that a tax planner may not be your best option. Have you considered an Independent financial advisor. They are regulated and may, if nothing else, set you on the right path.

For example you may be able to utilise some of your spouse's personal allowance if they have one.

Cook_County

If you are planning on returning to your home country you will also want your chosen professional to advise you how a UK pension plan is taxed in your home country.