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Tax relief |
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Tax reliefThe government allows an artificially low tax rate to encourage purchases or savings such as with pensions and ISA's.Tax reliefAmounts which you can deduct from your annual income to reduce the amount on which you have to pay tax. For instance, if your income before deduction of reliefs is £20,000, and you made pension contributions in the year of £1,000, you could deduct £1,000 from £20,000 to produce a total income of £19,000. That is because pension contributions are payments on which the Inland Revenue allows you to get relief.From total income, you would also deduct any allowances, including your personal allowance of £4,615 in the year 2003-2004 for people under 65, to produce your taxable income.Similar MatchesImport reliefImport reliefUsually refers to some form of restraint of imports in a particular sector in order to assist domestic producers, and with the connotation that these producers have been suffering from the competition with imports. If done formally under existing statutes, it is administered protection, but it may also be done informally using a VER. Retirement reliefRetirement reliefA special relief for Capital Gains Tax purposes which applies when an individual aged 55 or over disposes of his business or an interest in a business. Life assurance premium reliefLife assurance premium reliefA tax relief of 15% on the premiums paid into long-term insurance policies. Applies only to policies lasting for more than 10 years and issued before March 13, 1984. Holdover reliefHoldover reliefThe practice of deferring capital gains tax liability on a gift by transferring the liability to the recipient. When the recipient eventually sells the gift, the full CGT bill will normally fall due then, and the recipient will have to pay it, not the donor.To put this in context, remember that normally when a person makes a gift of, say, shares to anyone other than his/her spouse, the gift is deemed to have been made at fair market value and will be liable to capital gains tax if a gain has been made. This can be unattractive to the donor because he/she will not actually have made a gain, and won't have received any money at all if the asset was given freely. Holdover relief puts the tax burden on the recipient rather than the donor, and postpones the time when it has to be paid. Business property reliefBusiness property reliefA deduction of either 50% or 100% which is made from the value of business property when it is assessed for inheritance tax purposes. Further Suggestionsdouble taxation reliefmortgage interest relief at source Debt relief agricultural property relief rollover relief taper relief Debt relief |
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