Building financial stability beyond COVID-19
As a “new normal” starts to emerge, individuals and businesses have made it through the period of uncertainty but as government support comes to an end there are many factors that should now be considering. We are progressing into the 2020/21 tax year at speed and there are some key changes that have been overshadowed by the pandemic that we would like to highlight.
As trusted business advisors, our service offering not only includes tax and accounting but is wider than that and covers other specific areas such as business planning and HR services.
Ensure you financial data is up-to-date and that you continue to monitor the key financial indicators, so you know the state of your business and financial situation. Our accounting departments can create cash flows, budgets, forecasts and management accounts for your businesses. To help you create your action plan we can provide business advice as well as help you manage your costs.
Find out more about our services here.
Given the negative effect that the Covid-19 crisis has had on the self-employed, partners, and members of LLPs and the likely drop in profits that will arise as a consequence, it may be beneficial to speak with your accounts manager to discuss whether a change in accounting date relief, could generate substantial tax savings.
Get in touch to find out more.
For those who would like an overview of their personal finances, the Private Office at Sopher + Co offers the preparation of a Net Worth Statement that can be updated as regularly as you wish and can serve as a useful document for planning and forecasting.
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- 2020/21 Pension Tax Relief Changes:
Amidst the pandemic changes to the annual allowance charge may be overlooked and opportunities missed. In 2020/21 both the 'adjusted income' and 'threshold income' amounts have been raised by £90,000 to £240,000 and £200,000 respectively. However, where an individual's 'adjusted income' exceeds £240,000 and the annual allowance is restricted, the lowest the annual allowance can be tapered down to is £4,000 for 2020/21 and later years (rather than £10,000). Read more here.
Whilst the lock-down and reduction in business activity caused by the Coronavirus outbreak has had a negative effect of the value of many assets, such as property, shareholdings and other assets, this does give rise to a potential opportunity to gift these assets to loved ones at a far lower market value, and consequently reduced Capital Gains Tax than previously.
Read more about the potential benefits of gifting here.
The taxation of UK residential property has changed over recent years as successive Governments have made it clear that they wish to take advantage of its increasing value. The most recent budgets have implemented changes to property taxation which have changed rules in respect of Capital Gains Tax and interest relief. The effect has been to increase the tax taken from property income and gains and also to discourage the purchase of buy-to-let properties.
Read more here.
- Lasting Power of Attorneys and Wills:
The pandemic has shown that no individual can see into the future. In order to protect your health and wealth it is in important that you have the above documents in place, so that when the time comes your wishes are fulfilled.
View our recent webinar on LPAs here.
Should you wish to discuss anything in more detail or if you would like specific advice then please do not hesitate to contact your Sopher + Co adviser. Alternatively you can complete our online contact form, email us at email@example.com or call 020 8207 0602.