Avoid a potential 55% tax liability– you must act by 5 April 2014

If your pension savings are projected to be valued in excess of £1.25 million by the time you reach retirement, then you urgently need to consider whether to register for ‘Fixed Protection’. This may sound a lot of money and seem only to be relevant for the very wealthy but if you have a decent company pension accrued from the past or are still say 10-15 years from retirement, it is quite easy for the “Lifetime Allowance” to be exceeded. The Lifetime Allowance is the maximum amount that you can save into pensions throughout your lifetime without suffering a tax charge at retirement.

Tax sting in the PPI refund tale

The rules HMRC applies are reasonably straightforward: if your claim for PPI compensation is upheld, you will get a refund of premiums paid, the interest you have paid on the premium if it was added to your loan, plus simple interest at 8%.

While the principle is to return you to the position you would have been in if you had never taken out the PPI policy, the 8% interest is taxable and must be declared to HMRC by including it on your self assessment tax return.

Pages

About Us

We are a firm of Chartered Accountants with a difference. We like to establish client relationships that allow us to understand both your business and personal goals.

Our forward-thinking approach means that we are consistently up to date with the latest tax and business legislation.

We provide a solution that allows our clients to rest assured that we will work towards achieving the best possible outcome for them.