In April 2010, a 50% rate of income tax was introduced for incomes over £150,000. This is the highest rate of personal tax in years and for the first time it means that for some, the Government take home a bigger share than the taxpayer!! Or put another way home pay has reduced by a massive 10%!
This level of taxation is here to stay – the Government has made that clear.
Anyone with income over £150,000 should be reviewing their financial and tax position to mitigate the impact of this. Entrepreneurs with aspirations to have income of over £150,000, but are not there yet, should be doing the same.
Making plans now could save you thousands in tax in later years.
Those with income over £100,000 have also been hit - by the restrictions in personal allowances. The basic personal allowance is currently worth £2,600 to a higher rate taxpayer - this is not an insignificant sum.
As the true extent of the impact of recent changes are now being felt, it is clear that the financial life of the entrepreneur has never been so complex, but planning needn't be complicated.
The RSM Tenon Wealth Experience looks at how to manage the impact of these changes and protect the wealth you have worked hard to build up. For those with aspirations there are plenty of opportunities to prepare yourself.
For more information on how we can help please contact your usual RSM Tenon adviser or e-mail twe@rsmtenon.com