Post-Covid Tax Planning

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With a three-day weekend on the horizon and most of the home DIY accomplished during lockdowns maybe it’s prime opportunity to take time out to plan your finances? Here, we offer some factors to consider in the wake of the pandemic.

The coronavirus pandemic has rocked environments for both individuals and businesses alike. Where some businesses have prospered, those working in industries such as hospitality and leisure industries have suffered a considerable loss of income. Whatever your precise circumstances may be, it is worth considering the following ideas for post-Covid tax planning as we enter ‘the new normal’…

Planning to buy residential property?

The Chancellor has extended the temporary stamp duty (SDLT) holiday for residential property acquisitions until 30 September 2021. There is still time for property investors to take advantage of this generous tax relief opportunity, although the surcharge payment will still be required.

Self-assessment payments on account

Your 2020/21 self-assessment tax return due on 31st January and 31st July 2021 is based on your 2019-2020 income and liability. If you anticipate your liability for 2020/21 to be lower than 2019/20 you can make a claim to reduce your payments on account. This will reduce the July payment and generate a repayment of the excess paid in January.

Check your PAYE code

All taxpayers are issued with a PAYE code annually. This determines personal allowances, based on the previous year’s figures. If Covid has significantly affected your income, if your income is likely to decrease dramatically in the future or if you have losses due to a drop in value of investments, the 2021/22 PAYE code you receive may not be accurate. It may be worth highlighting to HMRC to check if any adjustments can be made so that you don’t pay more tax than necessary or whether you are due any repayment.

Deductions for WFH?

It is possible for both employers and employees to claim a monthly tax deduction of up to £26 if you are working from home. This is assessed at a flat rate and is in place to assist with additional household costs if you are required to work from home for all or part of the week. Employees check if you can claim here.

Share portfolio dropped in value?

Has the value of any shares you may own dropped directly because of the Covid pandemic? If those shares were Enterprise investment Scheme (EIS) approved, you may be entitled to income tax relief.

Bowcock & Pursaill offer tax planning advice to individuals and businesses. Our Tax Planning team are available offer expert advice on all tax planning matters, advising on a wide range of structures which can help mitigate tax which can result in savings over several generations. To find out more contact us here or call 01889 598888.