What? That never happens, does it? Well actually, it can!
A client of ours recently received a letter from his accountant telling him he had a tax liability of c£50,000 which needed to be paid by end of January. Suffice to say, he wasn’t best pleased as this came about from a series of unfortunate events and he was unaware of a tax liability. A meeting was arranged to discuss how best to fund the payment, which we did.
However, as Financial Planners, we were also able to make him aware of a number of very tax efficient investment schemes. The one we discussed provides 30% income tax relief, CGT deferral and IHT free after 2 years, so a further saving of 40% (if applicable). Without going into detail, these schemes are fully legal and indeed approved by the Inland Revenue (HMRC) as the underlying investments are made into smaller companies, which is a good thing for the UK economy.
In this case an investment of £170,000, with the investment objective of capital preservation will result in our client receiving a cheque from HMRC (albeit in 18 months) to fully repay the tax he has just paid! The investment is being ‘back-dated to the 2014-15 tax year (the year in which the liability arose), which again is allowable by HMRC.
One very happy client, benefitting from sound financial planning advice. Happy clients make for happy advisers!
If anyone is interested in discussing these tax efficient schemes, especially as we near the end of the tax year, please get in touch for a no cost, no obligation meeting or chat with Mark or myself.