One of the main areas of CGT wastage occurs as a result of people not making use of ISAs to shelter their investments
London, UK (PRWEB) September 30, 2011
Research by professional advice website unbiased.co.uk, has found that UK taxpayers could be wasting as much as £148 million in unnecessary capital gains tax (CGT) payments this tax year, by not making use of tax planning strategies and allowances available to them when it comes to disposing or gifting their assets.
Every year individuals have a CGT annual allowance., CGT is a tax that arises from the disposal or gifting of assets that have increased in value. Items such as the sale of your primary residence or your car are not subject to the tax, however gains made on the sale of shares or buy-to-let properties are. The individual CGT free allowance for the 2011/2012 tax year currently stands at £10,600. Any gains above this are charged at 18% for lower and 28% for higher rate tax payers.
Figures from the unbiased.co.uk Tax Action report show that one of the main areas of CGT wastage occurs as a result of people not making use of ISAs to shelter their investments from personal tax liabilities. The ‘disposal’ (i.e. a sale or gifting) of stocks and shares outside ISAs are usually liable for CGT and any gains made will count towards your annual CGT allowance. Any losses can be offset against your gains.
Karen Barrett, Chief Executive of unbiased.co.uk, comments: “As a nation we have to be savvier when it comes to our finances and personal tax planning is still an area where we could be doing more to protect our income and assets. Making use of tax efficient strategies can make a huge difference and it’s important for people to think about how they can make the most of their allowances, which so many taxpayers waste each year, as well as reducing their liability.”
“The easiest way to prevent unnecessary tax payments and reduce any CGT liability is to visit an independent financial adviser who offers tax planning advice. By seeking independent financial advice, you can receive advice to calculate gains within your assets and can plan to offset any losses within the tax year thereby been very CGT efficient. . To find local, independent financial advice in your area, carry out a free and confidential search at unbiased.co.uk. You can also use this service to find an accountant, a solicitor or a mortgage adviser.”
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