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Carry Forward/Carry Back

Carry forward will be abolished with effect from 6 April 2001 in respect of any scheme that is subject to the new defined contribution (DC) tax regime. Although members of the DC tax regime will be able to contribute up to £3,600 per annum at any time while they are resident and ordinarily resident in the UK and will be able to take advantage of the new proposed provision which will enable them to continue contributions in excess of £3,600 per annum for up to five years after they cease to have relevant earnings, these provisions are by no means as flexible as the present carry forward rules. Clients will therefore be best advised to take full advantage of carry forward while they are able to.

It should be remembered that the new DC tax regime will not be extended to section 226 policies, which will retain their existing carry forward rules. Clients with section 226 arrangements may therefore be best advised to retain such policies as these may well give far greater opportunities for tax planning in the future.

With the reduction in the basic rate of tax from 23% to 22% in tax year 2000/2001 it should be remembered that a basic rate taxpayer will still be able to obtain relief at 23% by paying a personal pension/s226 contribution in tax year 2000/2001 and making an election to carry it back to the 1999/2000 tax year. Such election must be made by no later than 31 January 2002.


Loanback opportunity from capital allowances

For small and medium sized companies first year capital allowances on the purchase of plant and machinery at the rate of 40% are now permanently available. Small companies will also benefit from 100% first year allowances for investment in Information and Computer Technology equipment (computers, software and internet-friendly mobile phones) are available. Companies with SSASs […]

Brown&#39s pre-budget boost

Chancellor Gordon Brown has been given a pre-Budget boost with the public finances showing a £2.7 billion surplus last month. The Office for National Statistics says the surplus on the public sector net cash requirement was the highest February repayment on record. The Government&#39s third measure of the state of the public finances, the less […]

Remuneration Strategies for Shareholding Directors

As a result of last year&#39s Budget■ With effect from 1 April 2000, there is to be a new 10% rate of corporation tax for profits up to £10,000. Marginal relief will apply to mean that an effective rate of 22.5% will be paid on profits between £10,000 and £50,000 at which point the 20% […]

Pensions And Divorce

It is presently expected that the changes required to enable pension sharing to take effect will be implemented by the end of 2000. At present, where a couple divorce any pension benefits can only be dealt with either by offsetting or earmarking. The introduction of pension sharing will mean that clients and family lawyers will […]

Artemis Global Income: favouring Europe over the US

With a 10 per cent return from his Global Income Fund in the first three months of 2015, Jacob de Tusch-Lec talks to journalist Alexis Xydias about the drivers and why he favours Europe and Asia over the US. Jacob believes European companies remain cheap and is still finding opportunities amid value stocks – in contrast […]


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