The Importance of Tax Planning
Tax planning and wealth management are things that most of us see as a luxury for the extremely wealthy – however every accountant provides this service for everyone. Part of an accountant´s job is to ensure your tax liability is as low as possible and are more effective if you consult them for guidance whenever you make important financial decisions.
The mistake many clients make is to furry ahead with investments and believe the accountant will sort out the tax complications afterwards. The problem is, if you leave all tax related decisions to the end of the year in many instances it´s too late to recover savings.
Your tax goals
Most people pay more tax than is necessary because of a lack of understanding regarding tax laws. Whether you are purchasing vehicles or looking to buy commercial premises, doing it in different ways can have large impacts on your tax bill. The less you pay the more you have to invest in your company or save for the future.
It is fairly easy to get DIY tax planning wrong, the goalposts are constantly moving and there are lots of regulations (both personal and company) that must be taken into account depending on your own needs.
From the company perspective things need to be structured in the most tax efficient way to minimize the corporation tax due. There may however be other considerations such as you may wish to pay yourself a dividend, make improvements to a building, start or increase a pension or make other investments. All of these have an impact on your tax liability; it is therefore good practice to get in the habit of taking financial advice whenever considering anything like this.
Tax planning can also make life far easier for your heirs. As well as maximizing the amount left for them, it can also reduce their liabilities to HMRC if inheritance tax becomes due. If the total estate (family home, cars, savings and investments etc.) might be worth more than the inheritance tax threshold (currently £325,000) then this is crucial.
Making a will and putting things in place to ensure that any tax liability your estate may incur is kept to minimum can greatly simplify things for your heirs.
Many people approach their tax planning in a reactive manner, their main concern being the successful running of the business. However, your business will see far better growth with proper planning, smaller tax bills mean less paid out which equals quicker growth. Take control of your tax liability, plan for the current year and make adjustments to create positive momentum.
Self-employment tax advice
If you need advice about tax planning or any kind of financial investment, Taxaccolega, a low fixed fee accountant, can offer professional services with regards your tax liabilities and exemptions. There are ways of saving money on tax if you know the rules. We can also give you advice with regards a business model that is proven to bring success so call us today on 08000 235 234 or email firstname.lastname@example.org