Archived News April, 2010

Tax questions Carmarthen Journal 14th April 2010

We are in our late 60’s and have a reasonable amount of savings and investments. We are worried about possible inheritance tax when we die, given that our assets seem to be increasing in value and we do not have a lavish lifestyle. Is there a way we can give some regular money to our children and grandchildren without falling foul of any inheritance tax rules?

There are various exemptions from Inheritance Tax (IHT) that allow you to give money away in your lifetime. For example, you can each give a total of £3,000 away each year (£6,000 in the first year you decide to do this) and also you can give money away when your children and grandchildren get married. Another way is to make regular gifts from your income. To do this you need to establish what your income is and what your normal expenditure requirements are. Your excess income can then be given away to your relatives. You will need to keep records to prove that this income is not needed to maintain your standard of living and the gift needs to be made on a regular basis i.e. every month or quarter or year to qualify.

We are a new company based in Llanelli with only a few employees. With the year end for payroll just finished, what do we need to do in terms of filing forms etc and making sure we do not have any penalties?

Nearly all businesses now have to file their P35’s and P14’s online, no later than 19th May 2010, otherwise HMRC will issue late filing penalties. Your employees also need to receive copies of their P60’s (a summary of their income and tax deducted for the year) and it would make sense to do these at the same time. It is also worth noting that from 19th May 2010, your monthly PAYE & NI has to be paid on time as interest and possibly penalties will now arise. As a concession, you can pay by the 22nd of the month if you pay electronically.

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