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IFAP shows £4bn is being wasted in tax

Nine out of 10 adults in the UK – 45 million people – will waste £4bn this year paying unnecessary tax, according to IFA Promotion.

IFAP says its 11th annual TaxAction investigation shows an average of £114 is wasted per person and it is vowing to continue its War on Wasted Tax.

It has calculated that the UK&#39s tax wastage is enough to create a new millionaire every day for the next decade.

It now has a website, www.taketaxaction.co.uk, to explain the steps that people can take to stop overpaying tax.

The measures recommended by IFAP include using up annual Isa allowances, which would save £110m, and to fill in a self-assessment tax return form to save £404m.

By giving to charity, it says people could also save £254m by using a deed of covenant, gift aid or payroll tax breaks.

It says people with assets of more than £250,000 should plan their inheritance to avoid tax liabilities and save £1,355m.

It points out there are simple ways to chip away at this level of waste, including seeing an accountant about self-assessment or discussing the broader issues of financial planning with an IFA.

Chief executive David Elms says: “Given the sustained stockmarket falls we have seen, coupled with poor pension fund performance and continuing low savings rates, most people cannot afford to squander the tax breaks available to them. For some we are talking tens or hundreds of pounds but for many the sums are far larger. In all cases, a few simple steps could wipe out this needless waste.”

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