Most of us face being taxed on our income, our capital gains and in some circumstances the value of our estate when we die.

At True Bearing, as part of your long-term financial planning, we will review your current situation then devise and incorporate a tax strategy. This applies whether planning for an individual or business.

Taxation can be complicated and the rules, reliefs and allowances often change. It is, therefore, worth seeking the advice of an independent financial adviser to be clear on your tax planning strategies to achieve a tax efficient way of arranging your finances.

Our independent financial advisers can help you identify all your areas of tax wastage and advise you on ways to become more tax efficient, potentially saving you a significant amount of money over the longer term.


Tax Efficient Investing

At True Bearing we aim to develop tax planning strategies that can help you manage your affairs in the most tax-efficient way. Some of the areas we look at are:



The government already provide a generous annual entitlement to every UK saver in the form of ISAs. If you open an Individual Savings Account, you will be able to deposit £20,000 tax-free each year.

This means that any interest earned on the money invested is yours, and it is tax-free.



Tax relief is available to most pension contributions. However, Her Majesty’s Revenue and Customs (HMRC) will divert back allowable income tax that you have paid or are about to pay. They will then put some into your pension pot. Your pension pot’s ongoing growth is enhanced by tax reliefs.

To identify which rules, limits and allowances apply, you need to know what type of pension you have.


Annual Allowance

An annual allowance for pension savings applies each year and is based on a pension input period. The pension input periods are aligned with tax years. The annual allowance is currently £40,000, and any contributions over the annual allowance available will attract a tax charge.

This makes it one of the most important means of limiting your exposure to taxation.

It is also important to note that you can carry forward unused allowances from the previous three years, as long as you were a member of a pension scheme during those years.


There is an exception to this standard rule. If you have a defined contribution pension, and you start to draw money from it, the annual allowance reduces to £4,000 in some situations.

Limits on the amount you can build up in your pension – lifetime allowance

A lifetime allowance is a total amount that you can have in your pension before a tax charge needs to be paid. This occurs before taking benefits.

The lifetime allowance is £1 million for the tax year 2017/18. Any amount above this is subject to a tax charge of 25% if paid as pension or 55% if paid as a lump sum.


You may be able to limit your exposure to these tax charges by applying to HMRC for protection. If you have applied for protection before the current limit was set, you may not be able to pay in more without losing that protection.

With the state pension now commencing at later ages, it is more urgent than ever that you take control of your retirement planning.

calculator and pen on graph


Capital Gains

In the tax year 2017/2018, an individual’s CGT allowance is £11,300.

This means you do not have to pay tax on gains from buying and selling shares or other investments during the tax year up to that amount. You do not normally have to pay tax on any gain you make when you sell your main residence.


There are measures you can take to keep your CGT liability to a minimum, including:

  • Offsetting your losses against your gains
  • Transferring to your spouse or civil partner
  • Reducing your taxable income
  • Selling when you pay tax at a lower rate



Inheritance tax (IHT)

Inheritance Tax (IHT) is a tax paid to the Government when you die. The amount is paid based on everything you own.

As long as the total value of what you leave behind is less than £325,000 per person, there won’t currently be any inheritance tax to pay. This is known as the nil rate band. The nil rate band for inheritance tax and the rate of tax is usually set by the Chancellor each year in the budget.


Any assets above the nil rate band could be taxed at a huge 40%.

Many of our clients wish to act to mitigate or reduce Inheritance Tax. There are several ways to do this in line with HMRC rules and guidelines. Things to consider include:


  • Making a gift every year
  • Putting things into trust
  • Taking out life assurance to cover the IHT bill
  • Considering professional advice


Solutions can demand both financial and legal work. True Bearing are particularly well prepared for this, as we possess both skill sets within our services. Why not ask your adviser if he or she can include Inheritance Tax Planning in your advice package?



Getting Some Guidance

This list of tax benefits is by no means exhaustive and is simply there to show that being sensible with your finances could possibly help to reduce your tax liability.


Getting help and seeking advice can be one of the most effective investments you make. Speak to our financial advisers to get help with your tax planning strategies. For a no-obligation meeting at our expense, call 01257 260011 or email