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  • Section 24 HQ

    How are you going to pay your S24 tax bill?

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    I did a root and branch look at my bussiness

    i have used a selection of the above

    The most easy one I use is Pension Planning

    If you have income from elsewhere ie employment or self employment and your a 40% tax payer due to S24 its easy to recover tax

    I have also used my Company for Management and I use it to buy Property I own in my own name

    I intend to chip away at the Tax and do the best I can

    Build to rent with cash will also help pay my S24 tax bill

    I look upon this now as an opportunity to change the way I work

    I don't expect any changes to S24 so I am happy just to plod along with what I have got

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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.


    Just be aware that putting money into a pension only mitigates a quarter of the tax. If you are a higher rate tax payer in retirement the rest of the tax is simply postponed, this is because you pay tax on the money you draw from the pension in retirement. If you are a basic rate tax payer in retirement and a higher rate taxpayer now then you have mitigated 2/3rds of the tax and postponed the rest.

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    I personally will never take the taxable element of the fund

    i will use it for my children as a way of avoiding IHT

    its very tax efficient now with the new rules

    I will keep funding till I’m 75


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    Learn Change and Adapt ?????

    All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.


    Interesting question Vanessa!

    For me its:

    4.  I have been increasing my income streams elsewhere.

    I had another fledgling business that I've been putting more effort into, which is paying my tax bill. As s24 bills increase, so will the other business to counteract it, plus it gives me a much needed input brain-wise in an area that's non-property! It needs storage though, so has involved me buying property so I can't quite get away from it...

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    Just seen the video above and wondered where I can find the tenant rent increase template?.

    I have not raised rents in many years but starting to now so could do with an explanation to them as they all think I am loaded..lol

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    I am just taking less profit from rental income stream

    But increasing rents as well where the opportunity arises

    Profits went up significantly  when rates came down so it was nice why it lasted

    May fix for 10 years but not at the mo

    Buying the odd unit cash so the rent will service the increasing effect over the next 4 years

    An extra 5K rental income will help soften the blow

    If I buy at 100K and it  goes up 5% pa as well then I in effect get it back so no net loss

    Do something else maybe but just because i can

    I may start a cool nightclub and call it   `Section 24  `

    I expect the domain name has been taken by now though and the brand name patented

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    Jonathan Clarke. http://www.buytoletmk.com

    My suggestion is set a weekly standing order with HMRC paying ur yearly tax bill over 52 weeks - on 31st Jan 2018 u know ur tax bill total for 16/17 - starting 1st Friday in Feb pay 1/52 of that bill to HMRC, come 31st July 18 when u have to prepay 50% ur tax bill for 17/18, u will hv already paid 26 weekly instalments and hence nothing to pay, on 31st Jan 19 when u got the remaining 50% to pay + the balancing payment, u will find u hv paid the 26 weeks again, leaving u only to pay the balancing amount.

    This is hugely beneficial cause it keeps u ahead of ur liability and prevents the stress and need to ascertain where and who u are going to goto to fund the tax bill due, I've been doing it past 7 years and truly is best thing I've done in business - my bank / any lender loves it and gives you a serious level of confidence so that if & when u approach them for lending they see you are prudent in ur financial affairs/ liabilities due.


    Maz

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    Good shout Maz.  There is the option on HMRC to set up a direct debit, but I believe it is monthly.

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    Not sure if I want to pay the tax man before I have to

    I would prefer to invest that money in my own  BTL  rather than give it prematurely to  HMRC

    Buy a BTL on 6th April  2017 and not have to pay tax on  the rental income until  31st Jan 2019

    As investors surely our tax bills shouldn't come as a shock and they are factored in in advance

    Better to aim to make 20% ROI on our own cash rather than give to HMRC before its due

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    Jonathan Clarke. http://www.buytoletmk.com


    Totally agreed re: paying up-front.

    Better to put £x per month into an easy-access ISA or similar incase a little Bobby Dazzler of a deal comes along.

    It's not as if you get a thank-you card for paying it off early anyway!

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