School fees and tax savings...

john3:16

My son has a chance to go to a private school from next September. He has been awarded a scholarship worth 25% of the total fees from the School.

I am self-employed with my own ltd company. I have a couple of ISAs that can pay a couple of years but not all 6 years. Is there any way I can enhance his scholarship in terms of tax savings from my (Company) earnings?

I came across the following site but not sure if that's the best/only option for me - and it's a bit complicated.

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/01/13/cmfees13.xml

Any suggestions welcome.

Thanks
Gerry

Murdina

As I read it, all this is is an idea as to how you repay money you've borrowed to pay school fees. It overlooks the - to me anyway - rather more important point about what you plan to live on when you retire if you are going to use up your chance to make tax relieved savings by allocating the lump sum to paying off past expenditure (though I'm sure that's what many people do with their lump sum). Don't forget there are now lifetime caps on what you can put into a pension scheme.
As you run your own business, concentrate on discussing with your accountant the most tax efficient ways to extract funds now, so as to maximise after tax income & enable you to pay the school fees out of that.

john3:16

Yes. I am more interested in knowing if there is any other way. The link was just one example I found which I didn't really like. I have some ISAs which can cover 2+ years but need to come up with 4 more years from my current income (or other borrowing).

Basically my son has a small scholarship from the school (based on his ability) and I was wondering if there is anyway I could (with my ltd company) enhance it by sponsoring him or something and somehow gain a tax break from my Company income in doing so.

Regards,
Gerry

Murdina

I would endorse what jimmo says. There is no way you can do anything along the lines of sponsoring him - as I suggest above, instead discuss with your accountant how to maximise your income after tax and use that.
Don't forget that school fees go up every year without fail (and more than once, in my experience) and that you pay for absolutely everything else, including exam fees. numerous trips (small and large), books, numerous absurd items of games kit (which your child will lose with depressing regularity) and so on. So if you are going to be stretched, make sure you are budgeting for the full cost & not just the fees themselves.