ACCOUNTANT EXPLAINS How to Pay LESS TAXES to HMRC

Thanks to fiscal drag, in 2024 we are paying more income tax than ever before. In this video, I share 5 of the easiest ways to reduce your income tax bill, including the use of tax wrappers and timing your income and expenses if you are a business owner. I also cover one of the easiest ways to legally pay less inheritance tax.
TIMESTAMPS:
00:00 - Intro
00:42 - Pension contributions
02:22 - Lifetime ISA
04:50 - Cash ISA
05:56 - Timing of expenses
07:28 - Gifts
WHO AM I:
I'm Kiran, a qualified Accountant and experienced tax professional living in the UK. I make videos about finance, tax and investing.
MY FILMING GEAR:
Camera - amzn.to/3FxPlad
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DISCLAIMER:
This content, and the ideas presented in it, are for education and entertainment purposes only. Kiran does not provide tax or investment advice. The information presented does not consider the financial circumstances of any investor, and therefore may not be suitable for all investors.
Although Kiran is an Accountant, no Accountant-Client relationship is established with the viewer in any way.
As an Amazon Associate I earn from qualifying purchases. The product links in the description are affiliate links. This means if you choose to buy something through one of these links, I may receive a commission on the sale, but it makes no difference to you as a buyer.

[@RaymondKeen.]

We Are in Unchartered Financial Waters! every day we encounter challenges that have become the new standard. Although we previously perceived it as a crisis, we now acknowledge it as the new normal and must adapt accordingly. Given the current economic difficulties that the country is experiencing in 2024, how can we enhance our earnings during this period of adjustment? I cannot let my $680,000 savings vanish after putting in so much effort to accumulate them.

[@berniceburgos-]

Keeping some gold is usually a wise decision. You would be better off keeping away from equities for a bit or, even better, seeking advice from an expert given the current market conditions and everything that is at risk with the current economy.

[@hersdera]

You have a very valid point, I started investing on my own and for a long time, the market was really ripping me off. I decided to hire a CFA, even though I was skeptical at first, and I beat the market by more than 9%. I thought it was a fluke until it happened two years in a row, and so I’ve been sticking to investing via an analyst

[@SandraDave.]

Could you possibly recommend a CFA you've consulted with?

[@hersdera]

My CFA ’Melissa Terri Swayne’ , a renowned figure in her line of work. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.

[@CraigLloyd-fz6ns]

Thank you for saving me hours of back and forth investigation into the markets. I simply copied and pasted her full name into my browser, and her website came up first in search results. She looks flawless.

[@happygolucky3450]

this woman needs to be protected at all costs, her information is gold for the masses.

[@flexisingh]

This is such a great video, with all examples explained simply with clarity 👌🏼

[@gd7209]

This is the best short most informative video I have seen on KZbin

[@KiranKaurFinance]

Thanks so much for watching!

[@e.b856]

I ve watched all of your videos which I find them perfect,thank you.

[@KiranKaurFinance]

Glad you like them!

[@maxthemagition]

Most people know about these tips. However what we need is a real TAX expert who will expose the other tax loopholes of which there are many. The absence of whistleblowers says a lot about the corruption going on in the UK. TAX avoidance and evasion is a major industry in the UK today so we really need Tax experts who will blow the lid off TAX evasion. Is it fear that prevents the Tax experts from exposing the corruption?

[@Owaismh54]

Great strategy! I have a similar approach. I contribute to my pension pot for aggressive funds and also allocate some to a Lifetime ISA to benefit from the government bonus. One major advantage of the Lifetime ISA is that funds can be withdrawn in emergencies, even if criteria aren't met, although there's a 25% charge.

[@DragonXDrei]

I hope you enjoy your pension when you can retire at the age of 90... because that's where we are heading to.

[@markgriffiths409]

@@DragonXDreithat’s the state pension, not a personal private pension

[@rushilpatel6980]

Great video! As you mentioned these are the easiest to tax saving measures to implement. Please could you make a video about placing parent primary residence into a discretionary trust in order to mitigate IHT and the rough cost of getting this set up and managed and confirming if the parents can live in the property until the demise.

[@glove1748]

Thank you Keran. Great information you shared ❤️.

[@Hiprich]

Straight forward and concise. Love it ❤

[@gatekeeperboxing5898]

What a nice and clear speaking voice you have, you also explain things at a pace that is very easy to listen to (some youtubers speak so quickly, which I personally find rather annoying to listen to).

[@Best_youtube_videos]

Thank you dear, your videos critically reduce the time I waste on finding responses to tax topics

[@chayadajiratipasdamrong9597]

Thanks for this helpful info. You explained it very well.

[@KiranKaurFinance]

Glad it was helpful!

[@mosesmukuna]

Great advice. Thanks

[@sarcastixx74]

You forgot to point out that pensions become tax deductable as soon as you start to withdraw it from a drawdown or annuity, although you can withdraw 25% of the total amount tax free upon retirement so it is a bit of a saving. Employers are also obliged to pay into a pension on our behalf so most of us are automatically enrolled too.

[@lukemartin981]

This really grind my gears! If everyone just pays what they owe and not find loopholes in tax avoidance we would be in a far better place. We’re quick to judge people claiming benefits but this is the ultimate downfall. It’s called greed.

[@robertstallard7836]

The government makes the rules and people are simply following them. If you want to step outside of those rules and pay HMRC more than you have to then, OK. It's an odd idea, but it makes you happy....

[@pauldavies8658]

Nice short informative video thank you!!!

[@KiranKaurFinance]

Glad you enjoyed it!

[@yasirkamal1793]

Respect from Canada 🇨🇦

[@BobMc87]

Nice video! I should be adding more to my pension, but the company I work for has a horrific pension. They won't put more than 3% in, while we put in 5%, if they offered to match us up to 10-15%, I'd do it tomorrow!

[@redwoodcityintheuknscalera7179]

Great information ! thank you beautiful lady

[@s14vko]

Hey Kiran, just came across your channel. Thank you for the fantastic advice, that was really helpful. I was wondering would it be possible to make a video on 'creative' ways of reducing/eliminating tax using trusts for everyday people and any caveats that this may create, either now or in the future? I understand that number of things can be put into trusts including your home, life insurance, etc. sheltering your assets against tax, especially useful as part of your estate planning. If you could shed some light on this, that would be fantastic.

[@KiranKaurFinance]

Thanks so much for watching and for your comment - I will keep trusts in mind for future content!

[@ipprp7898]

I love your videos, have leant so much from all those advises. Thank you ! I wonder if you could you make a video about how to protect your asset and company after the dead of sole director shareholder, who would be in charge and running the company, what happens to those investments in that company and what to do now to avoid the disaster whicj will end up of loosing everything ? Thank you . I’m 25 single sole director shareholder of the tiny company .😊

[@Differentbias]

I would like to know any legal loopholes in self assessments for domestic property landlords and taxi drivers.

[@fern8580]

To pay less taxes? stopped working for 8000 per month, and being a tenant in a small expensive apartment, to get 1000 per month in a small village where houses cost 60,000! with a garden! No camera, no police, no taxman, only happiness!

[@tf2368]

Based

[@TheProfessorMAG]

Pension one; i never knew it; thx

[@najmabegum1783]

Very clear advice. Can you give one to one direct consultations on zoom or in person and if if person what location are you based in?

[@RICHARD-ei6wm]

The best way I have found to pay no tax at all is to put a chunk of cash into a VCT every year,this can reduce your tax bill to nil even if you earn 90k a year laying bricks like me.The HMRC hasn't had a single penny in tax from me since 1995 when they first came out.EIS will get a similar result.

[@khalidashfaq]

what is VCT please?

[@RICHARD-ei6wm]

@khalidashfaq Venture capital trust,new shares issued qualify for 30 percent tax deductions,if you buy enough every year you pay no tax at all.

[@RICHARD-ei6wm]

I agree,vcts are not for everybody,but I am a long term investor since the 1990s in some cases of shares I hold.I did have to sell some once through my broker to fund a holiday home and I was still in profit quite a bit with the tax saved and accrued dividends.Only a problem if you are a short term investor,I anticipate still holding all my vcts 20 years from now collecting tax free dividends all the way.

[@RICHARD-ei6wm]

I mostly stick to established vcts from octopus and mobeus,nearly all pay around 5 to 6 percent annually,usually split into two payments per year,sometimes distributing a special dividend.All of these I then funnel into fully funding my Isa,which in turn pays out dividends from the underlying investments.Hope this answers your question.

[@e.b856]

Also,I bit of advice : Use acoustic panel to your wall so that to reduse the echo in your room.❤❤

[@KiranKaurFinance]

Thanks for the feedback!

[@MrBasseer]

Great advise thanks

[@RichardEnglander]

Cool, I'd like to know more about inherence tax, what the threshold is, how it can be spread between the children. Thanks

[@scoita]

Your kids didn't earn it, so maybe they should pay tax it?

[@KIMONOJUDO]

The modern state needs a new modern Robin hood. ​@@scoita

[@joachim.charleshogg4728]

What are the opportunities of reducing our/my tax bill on the pension we/ I am currently receiving?

[@makeupbypost6616]

How can we setup Offshore companies?

[@villageintheshire]

You didn't mention the IHT figures.

[@u01ijm7]

Does the government contributions on a LISA compound annually?

[@deesinghda]

Hi Kiran, I need some personal advise on IHT, could you please recommend someone?

[@AviKhali]

I'd like to know what happens to your pension if you pass away before your payout birthday

[@fofoapex7273]

Hi, I have put some money to fill gaps in my state pension. Around 4500 pound. Am I allowed to claim tax relief on that? Many thanks

[@jondoe5532]

can a lifetime isa be used with a right to buy council property?

[@RichardEnglander]

Please say what the IHT threshold is and how to best distribute assets to several children.

[@tf2368]

Look it up

[@2011minos]

Do you have a practice that one can contact? Please.

[@eskiboy624]

Could you transfer your LISA into a SASS?

[@markemerson98]

but if you take a lump sum from that pension you have to pay tax - they get you either way - you dont get anything for free and even worse if you already have a salary income

[@smile3884]

Kiran if you get the opportunity to cover sas pensions would be great

[@smile3884]

@kangkong09 I’m guessing your not kiran

[@jayb1602]

Can you help me with this... can i get a tax refund for postage costs from my small business?

[@gatekeeperboxing5898]

Any cost relating to your business which you have paid VAT on is reclaimable via your annual VAT Return.

[@jayb1602]

@@gatekeeperboxing5898 thank you

[@jutthoney9891]

make some content related to small businesses

[@Steve_W27]

I’m pretty sure that first point you make about pensions is only applicable to higher rate taxpayers. The pension contributions would push part of the 40%tax eligible earnings down to basic rate tax. I’m sure that people who are just basic rate taxpayers, their pension contribution does not reduce their income tax liability, instead you just receive the tax relief via the government top up to your pension.

[@KiranKaurFinance]

My example shows pension relief via a net pay arrangement. I think you may be describing a relief at source arrangement, which is when extra tax relief is given to higher rate taxpayers by extending the basic rate band!

[@bhuushangajaananpaatil]

I am 1985 born and would like to invest 100-150 pounds every month, am I eligible to open ISA since I am above 39 yrs? Or any other place you reckon me to invest for longer term.

[@knowledgeseeker5499]

Anyone over 18 can open ISA and can add £20k per year 😊

[@bhuushangajaananpaatil]

@@knowledgeseeker5499 but gov.uk says from 18-39 yrs only..bit confused 😕

[@knowledgeseeker5499]

@@bhuushangajaananpaatil that’s life time ISA. Normal ISA is better option

[@bhuushangajaananpaatil]

@@knowledgeseeker5499 thank you so much for help mate🙏

[@Shariflondon1]

I am 60 so how would the Lifetime ISA work please?

[@Learningandunlearning7]

Unfortunately, you can only apply for a LIfetime ISA if you are under 39 years old

[@davideyres955]

@@Learningandunlearning7nice. Sounds a bit like age discrimination to me.

[@joefeely5291]

Being someone who is left of the left of the left, it seems very unfair that those with more financial wealth get to avoid taxes by these and other legal means. I say this as someone who is financially comfortable, thus if these unfairnesses were fixed I wouldn't expect to benefit directly, but I would like it if things were more fair.

[@sssfff]

Hi, can you please talk about how to mitigate capital gains tax of a second home. I am planning to sell the second home and heard there are quite a few conditions that will mitigate the cgt, as the cgt is quite big -- the house has been owned by me for 20 yrs and I've been renting it out. If I move in to live there for a year or two, how many months or percentage can I claim that is my main residence, so I can not pay the cgt for that period? There seems to be a 36 months extra that I can claim, if I rent it out again after I lived there for a year, and then live there after 36 months renting out, claiming it's the main residence again? I am flexible and can sell the house and move into the house at different times according to how much I can save for cgt. Thanks for clarifying this issue.

[@KiranKaurFinance]

Hello, it sounds like you are talking about Private Residence Relief. I will keep your comment in mind for future content. Thanks for watching!

[@cryptoym4136]

Hi, Could we withdraw our private pension before age of 55 years old ? Thank you

[@geofflancaster8542]

with a huge tax penalty, yes.

[@jaybee1655]

If you make gifts from surplus income. There is no limit and no IHT

[@mikeliuk]

07:59 As long as they "don't change your lifestyle and have a regular pattern" won't fall into IHT.

[@rinakaur7245]

Can you tfr money from a cash ISA into a stocks n shares ISA?

[@geofflancaster8542]

Yes

[@specialcircs]

You don't pay tax on the rise on the pension gains, but you still end up paying tax on the pension.

[@user-gr7lt9fj8l]

Take out all money and keep it at home locker 😂

[@raj080288]

Great tips! Much appreciated

[@sweetvuvuzela4634]

Ask the pm how to avoid taxes

[@pmkeith]

He does - by exploiting an offshore "trust fund". (Yeah, where did he get the money from?)

[@sweetvuvuzela4634]

@@pmkeith dodge contracts remember Ppe contracts nobody is in jail for the misuse of tax funds.

[@jamaldaone]

Great video kiran 👍

[@prestige3955]

Great content. Can you cover max pension contribution for a pension if your earning 220 k dividends per year.

[@andrewcarter7503]

Dividends are not relevant earnings for pension contributions purposes. So if your entire income is Dividends, you'll be limited to the basic £2,880 (net).

[@bbsaid218]

If you had a regular job and a side hustle, could you put all of your side hustle profits into a pension and not pay tax? Is there an age limit to a lisa ?

[@disneyrm1037]

You can only open a LISA between 18-39 for as little as £1.00 GBP, & pay in till you’re 50 but you’ll still gain interest after this. I missed opening a LISA by around 7 months, to which I am truly gutted as I’ve missed out on a possible £10K free from the Gov if I maxed it out each of the 10 remaining years. I luckily opened a HTB ISA before they stopped accepting any new accounts but it’s nowhere near as good as a LISA. If I roughly gave a personal comparisons then I would say HTB is less than 30% as good as a LISA with several other draw backs too.

[@jasonjames5646]

A plenty for getting your own money early 😅

[@commonman131]

So the rich can get away with not paying tax. So true

[@robertstallard7836]

There's no "getting away" with anything - it's just following the tax rules set by government. If you choose not to examine those rules and as a result end up paying more tax than you have to, then that's up to you.

[@zulfqarali905]

Hi keep it up you babe Ali Walsall west midlands england junction 10 m6 Walsall churckery up the walsall

[@Harpreet0601]

Hiii Is this possible if you make every video in punjabi or hindi? It will be helpful for those who can’t easily understand English

[@marton349]

This doesnt add up. On 2000 a hmrc tax calculator says it would be 1733. This video does not take into account personal allowance nor NI contributions.

[@KiranKaurFinance]

The numbers are intended to show how pensions work with a simplified example. You are right, in reality there are other taxes that need to be factored in!

[@mrmeldrew693]

The higher rate is so punitive, especially as a single income household like mine.

[@tj9382]

How can I be better off by paying out more money into a fricking pension? Anyone who believes this is a fool. Okay so you get tax relief of 20% but then they have it back off you when you finally draw it. Furthermore, pensions are just not growing at any decent rate anymore. My work pension has averaged 3.2% per year over the past 8 years. I’m getting more than that from my ISA and that’s tax free, and all in my control. You can only ever get 25% of your pension back free of tax, it’s a joke.

[@NPADV2023]

Ok can you answer me this then I pls. I pay into my pension through work. But I also pay 200 into my private pension. Can I save more money or not.

[@stuartpaul9211]

do a business that is also your passion/hobby. then you can buy toys to reduce tax liability.

[@robertosiveriosiverio2272]

The last month I pay 47% to my salary to HMRC. 🤬

[@knowledgeseeker5499]

I pay £30-35K per year from my pay that’s more tax than my brother salary for entire year 😢

[@rinakaur7245]

@@knowledgeseeker5499 i would be happy to be earning enough that warrants me to pay that much tax!

[@jasonjames5646]

My god , save tax but trust the pound will have value in 30 years ! Hell no

[@Anosha116]

Tax the rich stop wealth inequality

[@Wayne-wm6wq]

Well i dont pay any tax firstly i havent a contract with them and theres nothing in law that say's you have to pay it

[@adamfromabove84]

Just don't use the public roads, NHS, fire service, police or depend on armed forces to protect our country please then buddy - sincerely someone who contributes towards the cost of it.

[@Wayne-wm6wq]

@@adamfromabove84 did you know the Vatican collect all taxes from around the world once you go down the rabbit hole you will be shocked

[@elprofeta110]

I really work hard to engage myself in someway of earning more income. My family are happy once again and can now afford anything for my family even with my Retirement.$67k weekly returns has been life changing, after so much struggles.

[@elprofeta110]

Maria Angelina Alexander I really appreciate her efforts and transparency.

[@KuramaUchiha-id1ow]

Most people keep getting scared of taking risk,though I started with as low as $15,000 actually because it was my first time and it was successful, She's is a great personality in the state.

[@babytruca02]

Any specific guide. I'm from Georgia how do I go about this? I think I'm interested how can I get in touch with mrs Maria Angelina Alexander…

[@elprofeta110]

Yes, I will leave her info below this comment.

[@elprofeta110]

+1804

[@user-hs5pr5bt1v]

Leave the UK.

[@user-gr7lt9fj8l]

Sell and transfer all money to overseas 😂😂

[@laarats8426]

And then you complain why the country is falling apart

[@nigeljamalbrink]

Best thing to do, is pull your business out of the uk and move to dubai 😂

[@scoita]

Wow, what a wonderful career legacy. You've spent your life taking money away from schools and hospitals.

[@JohnHarthomstowCEO]

Nope, tax efficiency improves the private sector, the real driver of progress. Governments waste & have no incentive to be frugal with your taxes. The driving engine of humanity's progress is capitalism, baby. Starve the state, incentivise true progress.

[@scoita]

@@JohnHarthomstowCEO that's an ideological position devoid of empirical basis. It's also just ignorant - massive government subsidies for risky experimental science in universities has been the primary driver of technological progress in the modern era. Only later when commercially viable does it typically become privatised for profit by the corporate sector

[@JohnHarthomstowCEO]

@@scoita The empirical basis is extremely clear if you look at the big picture. Countries that tend towards capitalism (USA, UK, Switzerland, Japan, South Korea, Singapore etc) are far more developed & better places to live for their citizens that places which tend towards communism (China, North Korea, Laos, Russia, Cuba etc). Of course it's a sliding scale, no one is 100% capitalist and no one is 100% communist, but totalitarianism and excess government interventionism rarely ends well. Even government programs are typically carried out by private contractors.

[@bartoni79]

What an odd comment. There’s nothing illegal in this video, why wouldn’t you want to reduce your tax payments. The government actively encourage this by setting up ISAs and incentivising pension contributions.

[@scoita]

@@bartoni79 because reducing your taxes has negative consequences for society like I just outlined. I appreciate it might seem strange to be concerned for others if your world view is reflexively selfish

[@bats4bats]

All tax loopholes should be closed, pay your way and stop dodging. I have paid ll my taxes with no dodging all my life and am glad to do so. Tax helps fund NHS and our councils .

[@patrykgadomski4951]

Well that’s the choice you have made for not choosing to be as financially literate as you could be.

[@bats4bats]

@@patrykgadomski4951 it is not a case of not being financial literate , it is a case of not being a scummy person dodging my taxes. I pay my way in life and think everyone should do the same. I am well off even though i pay tax so why should greed be my number one priority in life ?

[@TheArrowBarrow]

@@bats4batsI too have paid my taxes all my life but couldn’t disagree with you more. I refuse to pay a single penny more than I have to any government. The government don’t use our taxes for the benefit of the people via the NHS or benefits etc as you state. That is just the rhetoric that they try to make you believe. They actually use the tax system as a means to keep us all equally poor. If they need more money all they have to do is simply print more of it and in turn cause higher inflation which is then an extra form of tax for the workers. All designed to keep the working classes poor and in our place.

[@MousquetaireC]

It's wrong she has not included national insurance

[@pnd7727]

Well done less money to be sent to ukraine and israel to waste and plunder.

[@ukswingers]

Venture Capital Trusts