2020/21 tax rates & points to note (& rate card download)
The new rates for the 2020/21 tax year have been released and there are a number of points to take note of and plan for, especially if you are working within the threshold margins. This article will outline key points and several options you have, to manage your tax payments.
It is even more important to plan ahead this year; many of us will have changing or reduced income because of the lockdown measures currently in place. You may find yourself in a different band or close to a threshold that you could manage to your advantage with some forethought.
Key tax thresholds for 2020/21 include:
- £50,000 – higher rate threshold (40%/41% in Scotland)
- £100,000 – loss of personal allowance (none by £123,700)
- £110,000 – threshold for reviewing annual pension allowance
- £150,000 – top rate/annual pension allowance restricted
£50,000 – £60,000 – loss of child benefit (1% per £100)
This is a particularly interesting threshold at the moment with many workers having been furloughed, as it may allow you to begin to claim child benefit again if your income has been impacted with the lockdown.
Capital Gains Tax (residential)
If you sell a residential property, you will now have to make any related capital gains tax payment on account within 30 days of completion. The exchange of contracts has to take place after the 5th of April for this to apply, although it was announced to day that this has now been postponed
You may find that you can change your payments or make payments to a pension scheme which could reduce your tax liability for the year. You will need to speak to an Independent Financial Adviser to see if this is appropriate for you.
Not only a potentially life affirming and changing act; contributing to a charity that helps to support, promote or research a cause close to your heart, could also help you to reduce your tax bill.
Take a look at our tax planning services below or get in touch with our specialist tax team to discuss planning your taxes.
View our tax planning services:
Talk to our tax team.
If you have questions about this year’s tax rates and how to plan for them, do get in touch with our tax partner, Robin Stevenson using the contact details below:
MOBILE: 07817 217857
Brexit: Actions for you and your business
As if a global pandemic wasn’t difficult enough for businesses in 2020, December brings with it the looming spectacle of Brexit. The UK is leaving the single market and customs union and the end of the transition period will affect citizens, businesses and travel to and from the EU. This article will discuss the changes and actions for you and your business that may be necessary.
The Job Support Scheme explained
The Job Support Scheme (JSS) is replacing the Coronavirus Job Retention Scheme (CJRS) which ends on 31 October. This new scheme will run for 6 months from 1 November 2020. The intention of the government is to support the income of people in work, allowing employers to keep their employees on fewer hours rather than make them redundant.
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