Tax Year End 2010/11 - Time for Action

David Pointer is a tax specialist working in central London. Here are a few of the key issues as we run up to the end of the 2010/11 tax year. David runs the Open Tax Consultancy and helps high net worth clients with sophisticated tax arrangements, if you think that this is relevant to you please get in touch.

With the end of the tax year only four weeks away people are busy taking out ISAs and topping up pensions, these simple but effective steps show that tax planning is no longer the kingdom of the rich and famous. A warning bell then, have you looked at your tax profile recently, taken stock of your personal tax situation and that of your family? Have you considered the various tax reliefs and tax efficient investment opportunities available to you? Are you sure you understand what you can claim and as importantly what will ruffle the feathers of the tax man?

For the more straightforward a good start is to think about what reliefs can be claimed, the annual capital gains tax exemption is a good example - £10,100 of tax free gains each year or £20,200 if you are married. If inheritance tax planning is an issue have you used the annual exemptions for this year and last year? Do you understand exempt gifts out of income? For the more adventurous amongst us there is perhaps Venture Capital Trusts that gives income tax relief for investing or the Enterprise Investment Scheme that boasts income tax relief, the opportunity to defer the capital gains tax payable on other assets sales and inheritance tax exemption, all freely on offer and, subject to ticking all the boxes needed, perfectly agreeable to HMRC.

In writing this I should also say it’s very important to remember that there is a close interaction between investment choice, personal circumstance, portfolio balance and taxation...... just because an investment offers a tax break does not give it a Midas touch. Tax relief can certainly be used to enhance considerably investment returns but if you can’t get your money back when you most need it then all that glistened may well not have been tax gold. So clever advice is to talk to people who collectively know their tax and investment onions, which is where Solomon's and Open Tax Consultancy can help

With the government spending squeeze and taxes on the rise people more than ever are looking to plan their tax pain away, charity it seems has never been closer to home. Tax by definition is taxing.