Military Resettlement, Business, Training & Recruitment
After a very successful year, Ashwood Homes is pleased to announce their new development, Mill View in Backgate, Cowbit. With 37 plots available with a range of two, three and four-bedroom homes and the added help of the Government backed scheme, Help to Buy, which is available on all our properties.
Did you know that MoD personnel are given priority when applying to buy a property through shared ownership? It could be your answer to making the dream of home-ownership a reality.
With the news that the Forces Help to Buy scheme has been extended to 2018, comes the real promise of increased home ownership for members of our Armed Forces. This valuable scheme coupled with the Armed Forces Covenant has the potential to change lives for many families.
Continue reading “Helping Our Armed Forces Buy Their Own Home”
Andy returned to the NHS after a 27 year career in the Princess Mary RAF Nursing Service. A desire for adventure and to travel prompted him to leave his staff nurse role and sign up. After Serving in Kosovo, Afghanistan and Iraq, Andy finished his Military career as a Wing Commander Nurse in October 2015. He is now Associate Chief Nurse at the Queen Elizabeth Hospital, in King’s Lynn.
It’s never pleasant to see how much of your hard earned savings or dividends from investments or other business can get swallowed up as part of your tax liability. We outline a few ideas to look out for to help reduce the amount you have to pay.
Saving money on tax doesn’t have to be through dodgy dealing and is certainly not immoral. The fact is that as a taxpayer, you are doing your bit to pay into the system in the first place and should have no qualms about receiving any monies owed back to you or being canny enough to know how to prevent overpayment.
The following ideas will be useful for people in a variety of circumstances:
Income Tax and National Insurance
The basics are that as someone earning money in the UK – even if you are posted abroad – you have to pay Income Tax. The basic rate of tax is 20% and the higher rate of tax is 40% – paid on taxable earnings above £32,000.
Everyone below pension age has a tax-free allowance of £11,000 (2016/17). This is the amount of money you can earn before you have to pay tax and is shown on your payslip as a tax code.
Tax code
Most people should have a tax code of 1100L. If you don’t have a tax code of 1100L you can get help to find out why from your pay office, or the Benefits and Money Advice team at The Royal British Legion or contact your local Citizens Advice Bureau.
Check your tax code each year (the numbers and letters on your payslip). If you’re on the wrong code, you may be paying too much tax.
Tax return deadlines
Don’t miss the 31 October deadline if you want to make a paper tax return. You can do your tax online up to 31 January, but paper tax returns need to be in three months earlier than online tax returns to avoid a £100 fine. Meeting the deadline won’t save you tax but it will stop you receiving a fine.
Redundancy money
According to the Money Force website, if you’re a Regular in the Armed Forces the compensation you receive when/if you are made redundant is tax free, adding: “You do not need to declare it on your tax return. But if it includes holiday pay or pay in lieu of notice, then you will have to pay tax on those elements, as you would on your normal pay.
Never assume your employer has got the calculations right. The tax deducted could be too much or too little and it’s up to you to notify HM Revenue & Customs.”
Annual investment allowance (AIA)
If you are a landlord or run your own business, you can take advantage of the annual investment allowance (AIA) to claim for expenditure on items such as tools and computers. You can claim relief on up to £200,000 a year.
Tax-free interest on bank and building society accounts
As of April 2016 you are entitled to a personal savings allowance. This means you don’t pay tax on the first £1,000 you earn from savings (or the first £500 if you’re a higher rate taxpayer).
Marriage allowance
Married couples and civil partners can transfer £1,100 of personal allowance from the lower earning partner to the higher earner, saving them up to £220 tax. (This is only if the higher earner is a 20% taxpayer- rather than a 40% taxpayer.)
Pension savings
The government encourages you to save for your retirement by giving you tax relief on pension contributions.
According to the Money Advice Service, depending on the type of pension scheme you have, tax relief either reduces your tax bill or increases the amount paid into your scheme. Where tax relief increases the amount paid in, you get the relief even if you’re a non-taxpayer. On top of this, your pension fund grows tax-free.
When you retire, you can usually take up to 25% of your pension fund as a tax-free lump sum. Your regular pension income is then taxed along with the rest of your income.
Self employed
Self employed people can claim tax-deductible expenses, including cash expenditure where eligible. Similarly, you can claim the running costs of a car, but not the purchase costs. (If you use the same car privately, you can claim a proportion of the total costs.)
Savings and Investments
Individual Savings Accounts (ISAs)
ISAs (sometimes called NISAs) are tax-efficient savings and investment accounts which can be used to save cash or invest in stocks and shares. (In 2014, Cash ISAs and Stocks and shares ISAs were merged into a new single ISA.)
The annual tax-free Isa allowance is £15,240 all of which can be invested into a Stocks and Shares ISA, or into a Cash ISA or any combination of these.
No Income Tax is payable on the interest or dividends you receive from an ISA and any profits from investments are also free of Capital Gains Tax.
Flexible ISAs
These offer a flexible facility which will let you withdraw and replace money from your ISA, provided it is done within the same tax year. Not all ISA’s will let you do this and you should check with your ISA provider that your ISA has this function. This flexibility is currently not available, for example, with Junior ISAs or the Help to Buy ISAs.
Tax rebate
According to the Money Force website, depending on your circumstances when you leave you may be able to get a tax rebate. The steps towards finding out and claiming the money back are relatively straightforward:
If you answered ‘yes’ to all of these questions, you might be due a refund. How much you can get back will depend on:
There’s a tax checker tool on the HM Revenue & Customs website. It should only take a few minutes to find out roughly how much money you can claim. (You’ll need paperwork such as payslips and bank statements before you start.)
Get your tax back
How you go about getting your refund will depend on:
If you’ve claimed any taxable benefits since losing your job, the Benefit Office has to pay your refund. This is because the tax you’re paying on your benefits affects how much you owe overall. Taxable benefits include Jobseeker’s Allowance and Carer’s Allowance.
You’ll need to send the Benefit Office parts 2 and 3 of your P45, keeping part 1A for your records. They’ll work out your refund and pay it either after the end of the tax year or after you stop claiming taxable benefits, whichever comes first.
If you’re claiming Universal Credit; this is not a taxable benefit, so once you’ve been unemployed for four weeks you can claim your tax refund from HM Revenue & Customs.
If you start a new job within four weeks of finishing your old one, your new employer will pay any tax refund you’re owed. Just give them parts 2 and 3 of your P45, keeping part 1A for your records. You’ll get your refund with your pay.
If you’ve been unemployed for at least four weeks
You can claim a tax refund by filling in form P50. Send this to HM Revenue & Customs with parts 2 and 3 of your P45.
Contact HM Revenue & Customs before filling in the form and they will tell you what other information you need to provide.
You should get your refund in the post within the tax year.
Download form P50 from the HM Revenue & Customs website.
Call the HM Revenue & Customs Tax Helpline on 0845 300 0627.
www.gov.uk/government/organisations/hm-revenue-customs
MoneyForce