Tax Tips for Newlyweds
In April of 2015, a new tax allowance has been made available to newlyweds. The amount you are subject to is dependent on who is working in the house and how much money is earned. Therefore, it is easier to understand some of the differences when you file as a couple.
Know Your Tax Rate
When you get married, the new tax allowance is available for those who do not already pay a high tax rate. This means if you are marrying a person who is paying a higher rate of income tax, you may not be eligible for the allowance. The maximum allowance is set at 10% so keep that in mind when filing taxes.
Take Advantage of the Capital Gains Tax
If you are financially capable, put as much money as you can (up to the maximum) in an ISA every year. Capital Gains Tax allows you to take income tax free from the savings. This will allow you to save money for retirement or your children in the future. Make sure you consult with an accountant to make sure you reduce your liabilities with money transfers, but still keep the most invested as possible.
Lower the Income with Pensions
When you fill out your financial paperwork, consider joining the pension plan your employer offers. Many companies will match the amount you put in. This is also pre-tax, so the amount of money you are taxed on will be less. In addition, you will be building an account that will give you money when you retire. The one thing to remember is you are not eligible for your partner’s pension until you are married.
Now that you are newlywed, you will be able to take advantage of the Inheritance Tax. This incentive allows couples to pass assets to each other without having to face a tax. This means when your loved one passes, you can have assets passed to the spouse without a tax being paid. This makes setting up a will vitally important. You want to make sure you have an attorney assist you in ensuring everything is legal. In addition, make sure that family members do not gift amounts that are above the Inheritance Tax limit. You want to make sure that everything you own can be passed to your spouse in case something should happen.
Finally, while not something that helps directly on your annual taxes, being married will help with your insurance payments. If you are married, you can take out a life assurance plan and you will find your premium is much less. You want to make sure you talk with different companies to find the best deals. When it comes time to get married, talking to an accountant is always the best option because they will know exactly how to save money. Taxes are extremely complicated and getting married will make them a little more so. While these tips will help you save money, ukweddingsavings.co.uk can help you find more ways to cut costs.