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Year End Tax Planning For Capital Gains Tax

Minimising your liability ...

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With the 2018/19 tax year drawing to an end, here are some ideas to ensure you minimise your Capital Gains Tax liability ...

Have you maximised your reliefs against Capital Gains Tax? What about including worthless assets?

Have you maximised your reliefs against Capital Gains Tax? What about including worthless assets?

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Are you using your annual exemption of £11,700 this year? You can't carry it forward so a spousal transfer may help ensure you use your annual exemptions to minimise what you owe.

"Don't forget to include 'worthless' assets!"

You could make a 'negligible value' claim which will create a loss. You can then set it off against other Capital Gains Tax liabilities or carried forward. There may be circumstances where CGT losses can be claimed against income.

If you're thinking of disposing of assets, then make sure you get the timing right, especially if there are significant changes in your income between tax years. As a basic rate taxpayer, CGT would be charged at 10%, but if you are on the higher rate, you'll get hit for 20%.

If you make gains on your property investments, then anything that doesn't qualify for Principal Private Residence Relief (PPR) will be chargeable at either 18% or 28%. Timing is everything, so if you can defer asset disposal until after 5th April 2019 then you'll delay the tax being due for a further 12 months.

"Remember, PPR Relief can only be used on
your main residence!"

Recently, a case was heard that has affected the qualifying period for PPR Relief. Ownership of the property now commences on the exchange of contracts, not the date of occupation. And in the 2018 budget, the Chancellor announced the final 18-months of PPR Relief availability with it reducing to just 6 months from April 2020. Letting Relief is also becoming restricted and will only apply when the owner lives along with the tenant.

And finally, the Finance Act 2019 extends Non-Resident Capital Gains Tax to all non-UK residents and companies when they dispose of a UK property. The Government are also thinking of introducing a 30-day payment window, from date of completion, on all residential property disposals.

"Would you like to know more?"

If you'd like to find out more about Capital Gains Tax and how you can plan to minimise your liability, do give me a call on 01908 774323 or click here to ping me an email and let's see how I can help you.

Until next time ...


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More about Helen Beaumont ...

Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist.

Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance.

When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.