Get married – save tax

I had to smile when I came across a recent blog from innovative Hampshire accountants, the Wow Company can be found at http://www.thewowcompany.com/blog/6-new-ways-to-save-tax-in-2011.  In a recent blog entry they listed six top tax planning tips for the rest of 2011. And what was at number six – last but not least – “get married !”

Their reasoning behind this was that from a tax planning point of view, getting married [or entering into a civil partnership for that matter] gives you an opportunity to reduce the amount of tax you have to pay. In particular they identified three principal areas of benefit namely;

  •          inheritance tax – both the exemption for spouse and the transferable nil rate band
  •          capital gains tax – transferring property to your spouse and reducing or avoiding CGT entirely
  •          income tax – the use of your spouse’s personal allowance by company directors – if your spouse doesn’t have any other employment or income

However, sadly some marriages and civil partnerships will inevitably end up in divorce or civil partnership dissolution. If you are unlucky enough to be going through a divorce, do bear in mind that you might also need to get specialist advice on your tax position, especially if you are a company director or business owner.