Personal Tax

Capital Gains Tax (CGT) is payable when you sell relevant assets such as shares or property and make a profit in excess of the annual exemption (currently £11,100 for individuals, £5,550 for trustees). CGT is broadly payable on the difference between the allowable costs of the relevant asset and what you sold it for.

In order to mitigate CGT, it is important to seek expert advice early on in the process. At Shaw Gibbs, we are able to calculate the CGT that you have to pay on disposal, whilst advising on the reliefs and exemptions available such as Principle Private Residence (PPR) relief. In addition, we have extensive expertise in working with non-UK residents and UK CGT implications.

With the increase in international movement comes the potential for increased tax reporting both at an individual and employer level.

For many individuals, the UK tax situation should be relatively straight forward but for those retaining property and investments outside of the UK, or wishing to transfer sums of income and capital into the UK to cover living or other expenses, the UK tax position can become a lot more complicated.

We help our non-resident and non-domiciled clients file their tax returns to the UK tax authorities. We also help individuals assess whether or not they are UK resident for tax purposes under the Statutory Residence Test and make claims under the relevant double tax agreements in place with their home location. In doing so, we ensure that double taxation is kept to an absolute minimum.

Additionally, we can advise employers and employees of the UK tax and social security implications of working in and out of the UK for both UK and non-UK employers.

As a part of the DFK International, a worldwide network of independent accounting, tax and business advisory firms, we can also co-ordinate advice with advisers in other countries to provide joined up advice.

Individuals that own and let property are facing a number of changes in regards to their rental income and the deductions they can make from their rents for income tax purposes.

The most impactful change is the gradual restriction of higher rate income tax relief for finance costs, which includes many landlord’s major cost, mortgage interest.

The restriction of income tax relief will apply to individuals:

• Who let residential property in the UK or elsewhere, and
• Who are claiming a deduction for financing costs (see below for list of costs included) from April 2017, and
• Who, from April 2017, will pay income tax on their property income at the higher (40%) or additional (45%) rate.

These changes will be implemented from April 2017, so it is important for landlords to consider the effects of this measure on their property business. At Shaw Gibbs, we have extensive experience in the property industry and can help you to explore your planning options in more detail.

Tax efficient investments are a way of investing your money in order to gain a more efficient or in some cases, a tax-free return.

There are a number of tax-efficient investments available for a variety of situations. Individual Savings Accounts are a popular option that allow you to make investments without being liable for income tax or capital gains tax. Pensions are another mainstream tax efficient investment wrapper as a 20% tax credit is added to your pension contribution.

These are just a few of the tax-efficient schemes on offer. If you wish to know more of the effective schemes available and want to put together a suitable investment strategy in place then please get in touch.

UK Self-assessment taxpayers have until the 31 October to complete and submit their paper tax return to HMRC. Failure to do so will result in an automatic fine of £100. For those that file online, however, the deadline is extended to 31 January.

The government plans to move away from paper tax returns from 2018 to a fully-online process by 2020. Most individuals and businesses are to be given individual digital accounts that will allow them to submit tax information regularly in real-time.

Each year, Shaw Gibbs’ Personal Tax department complete a large number of tax returns, having worked with certain clients for over 25 years. Our professional, tailored service has led to many happy clients, with 97% saying they would recommend us in a recent client survey.

If you would be interested in our annual tax return or wider personal tax service, then get in touch for a free consultation.

Trusts are important in helping you protect and provide for your future. Whether you have a certain goal that you are saving for, such as a comfortable retirement or your child’s university fees, trusts can be very influential in asset management.

As mentioned, it is likely that each trust’s purpose will differ. At Shaw Gibbs, we take time to understand your situation and then tailor our services accordingly. We can provide administration for the trust in terms of preparing accounts and completing tax returns. We can also offer advice regarding the tax implications surrounding the trust. Furthermore, we are able to act as trustee to your trust and assist with any disputes if they arise.

Since the passing of the Foreign Account Tax Compliance Act or ‘FATCA’ in 2010 there has been increasing focus by the US Internal Revenue Service on non-compliance with annual filing requirements by US persons resident outside the US. From 2017, there will be automatic exchange of financial information by HMRC to the IRS in respect of US persons resident in the UK.

Relevant US persons (those with a US passport, Green Card or born in the US) are required to submit an annual US tax return wherever they reside, with few exceptions. In addition, US persons resident abroad are required to submit an annual form in respect of foreign financial accounts they own or have control over.

The penalties for non-compliance with the annual filing requirements are potentially very high. Shaw Gibbs, working with a carefully selected IRS registered preparer, is able to assist US persons resident in the UK in becoming compliant with their annual filings and remaining US compliant, without incurring late filing penalties.

We are also able to provide advice on how to avoid some of the frequent pitfalls that result in much higher taxation on some UK investments for US persons. In many cases US taxation exposure can be legitimately reduced to zero with tax liability being only to HMRC in the UK, although the IRS will still expect an annual tax return to prove the US tax position.

An additional requirement introduced in 2018 requires certain US Nationals with major interests in non-US unlisted companies to declare and pay tax on retained earnings that have not yet been distributed to stakeholders. This will require additional reporting for UK resident US persons with a relevant shareholding in UK unlisted companies.

With the automatic exchange of financial information now a reality this is the time for US persons resident in the UK to act before the IRS approaches them directly as a delinquent US taxpayer.

As a part of the DFK International, a worldwide network of independent accounting, tax and business advisory firms, we can also co-ordinate advice with advisers in other countries to provide joined up advice.

Inheritance tax (IHT) is levied on a person’s estate when they die, and certain gifts made during an individual’s lifetime. Most gifts made more than seven years before death will escape tax. Therefore, if you plan in advance, gifts can be made tax-free: the result can be a substantial tax saving.

The tax rules surrounding IHT have recently changed with the introduction of the Residence Nil Rate Band (RNRB), which came into effect in April 2017, the idea behind this is a reduction in IHT that individuals will suffer on their main home.

In seeking professional advice, there is scope for substantial savings surrounding IHT. At Shaw Gibbs, we look to tailor our strategy to fit your situation. We look to take into account your circumstances and aspirations, whilst focusing on your long term financial security.

We offer fee protection to cover our clients from any fees that arise due to an HMRC investigation.

Working with Croner Taxwise, our fee protection insurance will provide the ultimate protection for our clients, covering up to the equivalent of £100,000 towards our professional fees.

Read more about our fee protection insurance.