ADVANCE planning could be the key to firms avoiding the full impact of changes in taxation, experts in Hartlepool have warned.
Recent changes to taxation legislation will mean the loss of higher rate tax relief on pension contributions totalling in excess of £20,000pa (£50,000pa for payments after April 1, 2011 – although there is scope to carry forward unused limits from the previous three years).
Changes will also mean an increase in annual Income Tax liabilities with the loss of the Personal Allowance and introduction of the new 50 per cent rate of Income Tax, where income exceeds £100,000 and £150,000 respectively.
Waltons Clark Whitehill is warning that lawyers may not learn the full impact of tax changes until January 2012.
Paul Harrison, a partner at the Hartlepool firm, said: “Many legal practitioners we work with are being hit with a double tax blow.
“It could even be that the full effect of this will not be felt until payments of tax become due on January 31, 2012.”
He added: “Advance planning in this area can result in significant tax savings.
“In some circumstances overall tax liabilities can be restricted to 20 per cent – a significant saving. This is an expanding area of taxation and is something we are already helping existing clients with and are keen to develop further with new and existing clients.”