In the News

50% Tax from April 2010 – will it affect you?

 Are you aware of the recent tax rule changes announced in the April 2009 budget  which will impact high earners and come into force from 6th April of this year?

 

These increases will hit more people than you might think; not only bankers and high flyers but also Doctors, Sole Traders, Head-Teachers and many others.  For the first time in many years high earners will be paying out more in income tax and national insurance than they will be keeping for themselves!!  The Government has also taken measures to prevent people from obtaining tax relief by increasing pension contributions.

 

 

The Facts

Withdrawal of personal allowances; this will mean that people earning between £100,000 and £112,950 will pay income tax at an effective rate of 60% on all earnings above £100,000.

New rate of Income tax of 50%; On all earnings in excess of £150,000 income tax will be charged at 50%.

Reduction in relief for pension contributions; New provisions have been introduced severely reducing relief for pension contributions in some circumstances which in part has been introduced retrospectively

 

These changes may appear alarming but there are still measures that can be taken to reduce its impact as long as you act fast.

 

 

For further advice please contact Patrick Lydon at Warings by email on patrick@warings.co.uk or by telephone on 01204 534031.

8th January 2010

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