As the end of the 2010-11 tax year draws nearer, individuals and businesses are looking at ways to maximise income in the new tax year. As 6th April 2011 approaches, a low cost accountant can help you to minimise your tax bill for 2010-11, while putting in place strategies for 2011-12. The tax increases for higher rate taxpayers will have a huge effect on income, requiring consideration for the next tax year.
Higher rate tax payers will start to pay 40 percent tax after they earn £42,475, following a reduction in the basic rate limit to £35,000 and an increase in personal allowances to £7,475. Income that exceeds £150,000 will be taxed at the higher rate of 50 percent, while your tax free personal allowances diminish when you earn over £100,000. For many business owners who are married, employing their husband or wife to work for the business will reduce overall profits and therefore, tax liability.
Individual Savings Accounts are also available to maximise income. The amount you are allowed to invest in a cash ISA 2011-12 is £5,340, with the remainder of the annual £10,680 being invested in stocks and shares.
There are many ways to maximise income, whether as an individual taxpayer or as the owner of a business. A reputable cheap accountant’s service will help you to minimise the tax you will pay for 2010-11, while planning for the 2011-12 tax year, staying within the relevant legislation in order to maximise profits and pay less tax.
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Content Writer working alongside our expert accountants to bring you the latest Tax and Accounting news.