High Paid Earners

We are all aware that the chancellor has decided to increase the tax take from our better clients with attacks on those earning over £150,000.

Although the final detail will not be known until July when the finance bill is finalised there are steps that you could be taking now. Have you reviewed your client lists so that you do know all clients who have income, both earned and unearned, of at least £100,000 or particularly those who also have pensions? If not it may be worth doing now so that you are ahead of the game when the final rules are known.

The £100,000 limit is important as it is at this level that you will start to taper your personal allowances. They disappear as soon as the income reaches £112,950.

What can be done to help? There are various ways to get "paid" that will reduce the overall income below the thresholds. For instance is there a valuable service etc that the client pays for out of their net income such as childcare where a salary sacrifice could be used?

Being paid in shares under a government scheme such as EMI could also be useful. There are always EBT's but as usual these are being looked at carefully by HMRC.