Saving money today is critical and there are a number of ways that you can save on taxes. If you are looking to cut your costs, here are the top 10 ways to save on your tax.
- Check Your Tax Code – You should check your tax code every year to ensure that you are on the right code. If you are on the wrong code, you are likely paying too much tax. Your tax code can be found on your pay slip.
- Remember Capital Gains Tax Allowance – Capital gains under £10,600 are considered tax-free. Capital Gains Tax is charged at 18 percent for standard rate taxpayers and 28 percent for higher rate payers.
- Don’t Miss the Deadline – If you miss the 31 October deadline for paper tax returns you are likely going to pay a fee. Paper tax returns are required to be in three months earlier than those done online or you could pay a fee of up to £100.
- Annual Investment – Don’t forget your annual investment allowance. Landlords or business owners can take advantage of this allowance to claim costs for computers, tools and other critical business needs. You can claim relief for these items for up to £25,000 each year.
- Business Expenses – If you are self-employed, you can claim tax-deductible expenses. These can include cash expenditures.
- Car Costs for Self-Employed – Self-employed individuals can also claim car costs for the operating expenses of vehicles. You cannot claim the purchase of a new automobile.
- Cash-Flow Boost – Again for self-employed, you can improve your cash flow by selecting an accounting year that ends earlier in the tax year. This will help to maximize the delay between making profits and tax time.
- Annual Losses – Claim your annual losses. You can carry forward these losses from the previous year to offset profits from next year.
- Account Payments – If you are self-employed and you expect to learn less this year than the year before, you can apply to reduce payments on the account.
- Rent Empty Rooms – You can rent out empty rooms in your home and receive up to £4,250 in rent every year from a lodger. This rent is tax-free but only applies if you rent out a furnished room in your own home.
This article was written by Cheselden Continuing Care, the leading continuing care review specialists in the UK. Feel free to learn more by visiting our website.