The tax return deadline is just around the corner and so some may be considering income tax relief.
What is tax relief?
Tax relief is a type of relief that means you either:
· Pay less tax to take account of money you’ve spent on specific things, such as business expenses if you’re self-employed.
· Get tax back or get it repaid in another way, such as a personal pension.
Some types of tax relief are given automatically. However, others you have to apply for.
When are you entitled to tax relief?
Tax relief applies to pension contributions, charity donations, maintenance payments and time spent working on a ship outside of the UK.
As mentioned before, it also applies for business expenses. This means you my be able to get tax relief on the money you spend running your business or claim tax relief if you’re employed and you use your own money for travel etc.
Actors, musicians, photographers, dancers and other professionals in the entertainment industry have very complex and unique expenses and reliefs they can claim; -many that are unknown and so unclaimed.
Tax relief on charity donations
Any donations that are made to a charity by an individual are tax-free. Therefore, you can get tax relief if you donate through gift aid, straight from your wages or pension, through Payroll Giving.
Charities and community sports clubs (CASCs) can register with HMRC to be part of the Gift Aid Scheme. When you’re registered, they can claim back the tax you’ve already paid on your donations.
To claim back tax you’ve paid on the donation and what the charity got back when you fill in your Self Assessment Tax Return.
Payroll Giving Schemes
All payroll giving scheme donations made through your employer are exempt from tax. Your National Insurance (NI) contributions will including the donation amount.
Maintenance Payments and tax relief
Maintenance payments relief works to reduce your income tax when you make maintenance payments to an ex-spouse or civil partner.
Your are entitled to Maintenance Payment Relief of you fall into all of the following categories:
· Either you or the person receiving the payment is born before 6th April 1935
· You’re payment maintenance under court order after the relationship has ended.
· The payments are maintenance of your ex-spouse or formal civil partner (provided they aren’t now remarried or in a new civil partnership) or if your children are under 21.
Maintenance payments Reliefaccounts for 10% of the maintenance you pay to your ex-spouse or civil partner.
For more information on UK tax contact us now
7 HENRIETTA ST
LONDON, WC2E 8PS
+44 (0)20 3829 3492