Daily Express Wednesday, August 7, 2019 29DX1STBy Harvey JonesThink smart to
avoid threat of
a shock tax bill
are most likely to face a bill:
“Last year, investors saw record
capital gains on their share sales
but many faced a substantial
CGT bill as a result.”
You can prevent this by invest-
ing through an Isa, where all
income and gains are free of
CGT: “Your allowance is now
£20,000 so you can build a sizea-
ble tax-free portfolio.”
You could steadily shift over
non-Isa investments, Coles
added: “Sell investments with
gains up to the £12,000 CGT
threshold then buy them again
inside an Isa, so there’s no tax to
pay now, and none in the future.”
The technical term for this is
“Bed and Isa”. You can also off-
set investment losses to reduce
your CGT bill.
Mark Giddens, partner at
accountant UHY Hacker Young,
said CGT planning is easier for
married couples and civil part-
ners, who can make tax-free gifts
to each other: “They could trans-
fer a holiday home into joint
names to reduce the CGT bill.”
Donations to charities are also
free of CGT and consider taking
financial advice.paintings or antiques for £6,000
or more. Britons who own buy-
to-let properties or second
homes could also face a CGT bill
when they sell.
If you pay income tax at 40 or
45 per cent, CGT is charged at
28 per cent of any gains on resi-
dential property, and 20 per cent
on other chargeable assets. Basic
rate taxpayers pay lower rates
based on variables such as the
size of your gain, taxable income
and whether it is from residential
property or other assets.
CGT is charged on the profits
rather than the full sale price but
that still means a higher-rate tax-
payer who bought a buy-to-let
for, say, £200,000 and sold it for
£400,000, could pay 28 per cent
of the difference or £56,000.
Fortunately, everybody can
make £12,000 this tax year
before paying CGT, and couples
can double that to £24,000.TAXING TIME
Hargreaves Lansdown personal
finance analyst Sarah Coles said
those aged between 55 and 74BRITONS are being warned to
avoid a capital gains tax (CGT)
shock as the taxman takes more
than ever from this levy.
Taxpayers were stung for
record amounts of CGT last year
with the average bill a hefty
£31,317, yet many could have
reduced or escaped this with
some basic financial planning.
CGT has been described as the
forgotten tax, but ignoring it can
be a costly slip, as growing num-
bers are discovering to their cost,
with 281,000 getting caught in
the net in the 2017/18 tax year.
HM Revenue & Customs gen-
erated a record £8.8 billion in
CGT over that tax year, an
increase of 14 per cent. That eas-
ily beats the record £5.2 billion
inheritance tax take, which most
people loathe but is less costly.
GAIN AND PAIN
If you hold shares or investment
funds outside of a pension plan
or tax-free Isa, you may be liable
to pay CGT on your gains when
you sell. You could also face a tax
demand if you sell or gift expen-
sive personal belongings, or
“chattels”, such as jewellery,
HIGHLY STRUNG: Prized
possessions such as
musical instruments need
Picture: GETTYlooking after financiallyVisit Your Money online at http://www.express.co.uk/money
Edited by Harvey Jones
Your Money email: [email protected]
Protecting your passions
does come at a premium
THE British are a nation of hobbyists
and collectors but many leave items
worth thousands of pounds
completely uninsured.
Almost six out of 10 of us own a
collectible item valued at more than
£500, with memorabilia particularly
popular, along with vintage sports
collections, music artefacts and
movie souvenirs.
Artwork, ornaments, sculptures
and antiques are also highly prized,
while others own expensive fashion
accessories, musical instruments
and military objects of historical
value.
These can be worth a lot more than
you think with memorabilia, antiques
and militaria collections averaging
almost £3,000, according to research
from Direct Line.
It covers items including stuffed
sharks and tigers, full-size replica
terracotta warrior statues and a toysoldier collection worth £10,000. Yet
nearly one in four people fail to
insure prized possessions, exposing
them to risk of loss, damage or theft.
Nick Brabham, head of Select
Premier Insurance at Direct Line,
said: “It is surprising to see so many
people are not insuring their passion
projects, leaving £88 billion of
high-end items at risk.”
Most household insurance policies
will only cover individual items up to
a single limit, say, £1,000. Art,
antiques and valuable collectables
can all be targets for thieves, as can
high-value tech items, so you may
need to contact your insurer to get
them properly covered for an
additional cost.
Remember to calculate an item’s
replacement value, not its second-
hand value. Choose insurers offering
new for old cover, so items will be
repaired or replaced as new.РЕЛИЗ ПОДГОТОВИЛА ГРУППА "What's News" VK.COM/WSNWS