Enterprise Investment Schemes (EIS) - the 5 tax benefits

How would you like to . . .

·         Reclaim income tax you have paid to the taxman

·         Reduce the level of Inheritance Tax payable by your beneficiaries

·         Defer the payment of Capital Gains Tax

ENTERPRISE INVESTMENT SCHEMES (EIS) – the FIVE tax benefits

·         30% income tax relief on investments up to £1m per tax year

·         Must hold investment for minimum of 3 years

·         A gain arising on disposal of EIS shares is fully exempt from Capital Gains Tax

·         Must hold investment for minimum of 3 years prior to disposal for CGT exemption

·         A loss on disposal of EIS shares can be offset against income or capital gains

·         The loss is reduced by any EIS income tax relief claimed at the time of investment

·         Payment of tax on a capital gain made on the sale of any asset can be deferred if that gain is invested in an EIS

·         The gain must be invested in an EIS one year before, or three years after it arose

·         Providing the EIS shares qualify for Business Property Relief…

·         And have been held for a minimum of 2 years…

·         The value of those shares will be free from Inheritance Tax on death

There have been a number of changes to EIS investments recently, and they have increased in popularity particularly as pension tax relief has been reduced.

Ward Williams Financial Services Ltd have always given consideration to EIS investments, as part of an overall Financial Plan, and one of our Advisers would be happy to discuss your options.

EIS investments are considered to be higher risk investments, and it is essential to take financial advice in order to:

·         Ensure sufficient accessible emergency funds remain after investment

·         Restrict the proportion of your overall capital invested in EIS

·         Ensure the investment reflects your risk tolerance and capacity for loss

·         Diversify your EIS investment across a range of companies and sectors

·         Ensure you are focusing on investment fundamentals…not just the attractive tax reliefs

www.wardwilliamsfs.co.uk, wwfs@wardwilliams.co.uk

Ward Williams Financial Services Ltd. Registered in England No. 04359977.  Ward Williams Financial Services Ltd is authorised and regulated by the Financial Conduct Authority.

Introduction to Ward Williams Financial Services

Click here to watch our Director of Financial Planning – Cliff Pocock in action!

10 Year Anniversary

Much has happened since I first arrived to set up and run Ward Williams Financial Services Ltd in October 2003.

In the 10 years I have been at Ward Williams we have moved twice – from the High Street to Monument Hill and then fairly recently further up Monument Hill.  All of these moves have increased the distance of my commute from home to the office and the distance to the office’s normal “watering hole” – The Slug & Lettuce.

Initially I was working on a part time basis and Jane Watford, who looks after Payroll was designated as my assistant.

It was not long before I changed to full time and recruited our first employee, Clare Kingdon.  She is still with us and has been my “right hand man” through the expansion of Ward Williams Financial Services Ltd.

As the business expanded, further people were recruited and today we have the following team; Clare Kingdon, Hannah Peyton, Guy Campbell, Paul Nathan and Wayne Bass; a team of whom I feel that I can be justifiably proud. 

Ward Williams Financial Services Ltd now has over 800 clients and £58m of clients’ money under advice – significant numbers that demonstrate the success of the business.

Personally, the last 10 years have been hard work, but immensely enjoyable.  I have really enjoyed working with the staff, not only of Ward Williams Financial Services Ltd but also the whole Group.  The senior directors of Ward Williams Ltd, Malcolm McKinnell, Richard Hayward and Phil Grainger have been extremely supportive and I would like to place on record my appreciation of their efforts.

Finally, our clients, without whom we would not have a business.  A big thank you to you all.  I have enjoyed dealing with all of our clients and I hope that Ward Williams Financial Services Ltd can continue to provide them, and new clients, with a friendly and efficient service for many years to come.

I am certainly looking forward to the future.

Thanks for the last 10 years and here’s to the next 10.

  

Cliff Pocock

Breathing life back into your pensions!

FACT: In an economic climate of lower growth, plan charges take on greater significance.

Q: Are your old style pension plans being eaten away by old style draconian charges?

FACT: The risks you are prepared to take are as important as the rewards you hope to make

Q: Do you know if your pension funds are carrying too much downside risk? This is extremely important if you are closing in on retirement.

FACT: The retirement lifestyle you enjoy will only be as good as the income you generate.

Q: Do you know if your pension fund manager is restricting the growth of your retirement fund by consistently producing below-average investment returns?

FACT: The 5th May 2013 Sunday Times Money supplement carried this front-page lead:

“Pain for investors as funds shut down”

FACT: Managers of closed funds have no performance incentive to attract new investment.  

Q: Do you know if your pension plans are invested in one of the record 371 funds that were shut down over the last 12 months due to poor performance? Your pension funds could be unnecessarily losing thousands of pounds in value.

THE BIG QUESTION: If you hold a number of ‘frozen’ pension plans, how can you possibly hope to answer all these questions?

THE ANSWER: Let us help you answer these questions and provide you with simple, easy-to-understand solutions to increase your retirement income.

YOUR NEXT MOVE: Please contact our pension adviser Cliff Pocock (email cliff.pocock@wardwilliams.co.uk or call 01932 830664) to arrange a no cost, no obligation consultation for an initial analysis of your pension position.

Spring Clean Your Finances

As Spring appears to have finally arrived, now would seem a good time to give your finances a “spring clean”.

The Chancellor of the Exchequer delivered the Budget for 2013 on 20 March and announced a number of changes that will affect UK taxpayers.

The personal allowance for those under 65 has risen from £8,105 to £9,440, while for those aged 65-75 and over 75, the allowance remains the same at £10,500 and £10,660 respectively.

While the increase in personal allowance is good news, people earning over £41,450 (instead of £42,475 in 2012/13) need to be aware that they will become higher rate tax payers and any income earned above this amount will be taxed at 40%.

Individuals will have their personal allowance reduced by £1 for every £2 earned over £100,000; therefore an employee earning £118,880 will have no personal allowance and an effective income tax rate of 60% on the income between £100,000 and £118,880.

Those that earn over £150,000 will benefit from a reduction in the top income tax rate from 50% to 45%.

Have your circumstances changed? 

Have you had a pay rise recently?     Does the 2013 budget affect you?

It is possible to reduce your income below the £41,450 and £100,000 levels and therefore reduce your income tax liability by making contributions to your pension.

If you would like to know more about tax-efficient financial planning, please call us on 01932 830664 to speak with one of our qualified advisers or to book an appointment.

Ways to reduce your IHT liability

Ways to reduce your IHT liability

“The only two certainties in life are death and taxes” – Benjamin Franklin

Inheritance Tax (IHT) is usually payable on an Estate in the event of someone’s death. The current IHT threshold, also known as the 'Nil rate band', stands at £325,000. If your overall Estate is above this level, any excess amount will be taxed at 40% (although there are some exceptions in respect of charities etc).

Since October 2007, any late spouse’s or civil partner’s unused nil rate band can be transferred to the second spouse or civil partner when they die. This will mean that currently on second death the IHT threshold will be £650,000.

Example – Husband & Wife

Private property	£600,000
Bank accounts	£50,000
Investments (incl. ISAs)	£200,000
Other assets (e.g. cars)	£25,000
Total assets	£875,000
Combined Nil rate bands	£650,000
Liable to IHT	£225,000
Taxed at 40%	£90,000 tax liability to pay

To find out how to reduce your potential IHT liability, please call us to book an appointment or have an informal discussion with one of our highly qualified financial planners. www.wardwilliamsfs.co.uk

 

Ward Williams Financial Services Ltd is authorised and regulated by the Financial Conduct Authority. The Financial Conduct Authority does not regulate taxation advice.