A New Season and a New Tax Year
With the start of the 2012 County Championship in April, you can be excused if the new tax year (6 April 2012) slipped by without you noticing it. However, it brought with it a number of changes and financial planning opportunities. Some will have more impact on you than others, so the question is, where do you start?
The Personal Allowance
The tax change that will affect most of us is the change to the Personal Allowance, i.e. the amount that any individual can earn before they have to pay income tax. The Personal Allowance has risen from £7,475 to £8,105, which means the first £156 of weekly earnings is free of income tax.
Make use of your ISA Allowance
A common place to start saving and investing is through an ISA, where most income and all capital gains are free of tax. The amount that can be contributed is now set at £11,280 for this tax year. Of this sum, £5,640 can be held in a Cash ISA, with the remainder in a Stocks and Shares ISA – or alternatively, the whole amount can be invested in stocks and shares.
You are able to contribute up to the lower of £50,000, or your gross annual income into a pension scheme in the 2012/13 tax year. The ECB currently offers a very generous Group Personal Pension, where your County Club will contribute 10% of your annual earnings if employees contribute a minimum of 5%. When compared to many private sector pensions, this is an incredibly attractive offer and great value.
Tax relief is available on pension contributions at your marginal rate of income tax. On this basis, for example, if you earn £30,000 you would receive monthly pension contributions of £250 from your County Club and you would make a personal contribution of £125 (gross). In reality though, this would have only cost you £100 as you would have received tax relief at your marginal rate of income tax, which in this case is 20%.
Tax changes for families
The income limit for qualification for Child Tax Credits has gone down. From 6 April2012, if you have one child you may no longer qualify for Child Tax Credit if your annual income is above £26,000 or if you have two children and earn more than £32,200. Tax credits calculations are rather complicated though and are a potential landmine. The Money Advice Service www.moneyadviceservice.org.uk is a free and independent service set up by the Government which has a very helpful ‘Parent’s Guide to Money’. Here you will find detailed guides to the benefits and entitlements available. Make sure you claim what you are entitled to.
Credit: FF&P Wealth Planning, April 2012.
Beyond the Boundaries
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Lancashire County Cricketer Swaps Bats for Bones
Lancashire County Cricket star, Gary Keedy, is preparing for life after his playing career by studying to become a Physiotherapist.
The 37-year-old has spent 12 weeks working in the Physiotherapy Department at the Royal Blackburn Hospital, as part of his degree at the University of Salford.
The veteran left-arm spinner was invited by East Lancashire Hospitals NHS Trust to undertake a clinical placement in acute respiratory, critical care, surgery and neurological rehabilitation.
Gary said, “My clinical experience at Royal Blackburn Hospital during the winter months has been a thoroughly enjoyable one.
“The knowledge and skills I have gained working alongside experienced professionals are invaluable to me for life beyond first-class cricket as a Physiotherapist.
“The professionalism, dedication and high level of skills of the staff is a credit to the service.
“Although the pressures and demands are different to those on a cricket field, it was refreshing to be part of a different team who share the same values.”
Gary, who has been a Lancashire player since 1995, has served the Red Rose County with distinction.
The experienced spin bowler has taken close to 650 first-class wickets. Tracy McGlone, Acting Clinical Director of Therapies, said, “We were very pleased to have Gary spending time with us in the department.
“We are able to offer comprehensive and evidence-based training programmes for all our undergraduate and postgraduate Physiotherapists, as we accept students from universities across the whole of the North West region.
“We provide a wide range of theoretical and practical methods which are delivered by our highly trained, specialist Physiotherapists.
“Gary has been able to develop his experience as part of an holistic team approach and the staff have thoroughly enjoyed working alongside him. The team wish him every success in the future.”
Source: Neil Docking, Lancashire Telegraph – Thursday 22nd March 2012.
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