The UK tax system is a convoluted beast, with lots of exceptions to existing tax rules in place, which on the positive side, does allow for tailored tax planning, which Mirandus’ offers to individuals, whether you are looking for tax advice as a landlord, a small business owner, or an individual who has capital gains tax or inheritance tax needs, please get in touch.

Every year, lots of tax loopholes get closed as others open, but it begs the question, what is always tax free?

Cash gifts

If you pass on any of your assets to someone that is not your spouse or your children, generally speaking there is a capital gains tax implication if the asset has risen in value since you first acquired it.

The exception to this rule, however, are cash gifts.

So for example, if you gift £10,000 to your son to help him purchase his first property - tax free.

Furthermore, if your son’s income is lower than your own, say you have purchased the property during his university career, has a part time job in-between studies and he rents out one of the rooms, declaring the rental income under your son’s name means less tax to pay.

The only tax to be wary off here is inheritance tax further down the line, but this threat disappears if you survive the date of the cash gift by seven years.

This is a typical example where making a financial decision now could impact you further down the line if you are not in the know. We strongly recommend you talk to a tax adviser before you make any financial decisions relating to your wealth,

We can help

gifting from grandparents investment income.jpg — Children’s Investment Income

If you are looking for ways to provide tax efficient income for your children, you may already have Junior ISAs in place.
Have you also considered the opportunity for grandparents and other relatives to invest in their grandchildren’s future?
Grandparents have more flexibility to gift tax-free income every tax year and make use of the grand child’s personal allowance, currently set at £12,570., without incurring an additional tax bill.
Parents need to be careful of the £100 rule however, as any income they provide over £100 to children is taxed at their income tax rate.

gambling tax free.jpg — Gambling Winnings

Did you know that in the US any gambling winnings are taxed but in the UK they are not?
Whether you bet at the Grand National every year or religiously buy a lottery ticket every week, any windfall you make is tax-free to you.
This is also true for financial spread betting, where you can try to predict the direction of a company’s share price over a period of time or you can harbor a guess at what will happen to a currency. To be eligible for tax free winnings in this case, you need a dedicated spread betting account.

tax free lump sums.jpg — Tax free lump sums

Need a cash booster without being penalised by the taxman or unsure if income you have received is tax free?
An example of tax-free lump sums are:
* Termination or redundancy payments up to £30,000
* 25% of your pension savings taken out as a lump sum
* Insurance payouts
* A personal injury compensation

What happens to your pension when you die?

One of the benefits of saving into a pension is that money held in a pension is usually free from inheritance tax because it is considered outside of someone’s estate.

The exact amount you can pass on tax-free to your beneficiaries after you pass away depends on your age and whether you have started accessing your pension. If you pass away before age 75, then your loved ones would also benefit from not paying income tax on withdrawals from your pension.