If you are a contractor, then you've got to economize on taxes. If you keep paying all the taxes and do nothing to avoid them legally, then you can finish up paying half your money in taxes. Therefore , you have to start looking for ways to save and pay smaller in taxes.
Contractor pensions are one of the best ways to economize on taxes and save for future too. You'll be glad to hear you can save at least 25% taxes on pensions. When you put your money in pensions, you save more than the particular cost of money due to low taxes on allowance funds. But you have to avoid purchasing a pension to get all of these benefits.
If you're looking for ways to save on taxes using pensions, here are five sure ways that may work for any contractors.
Your family won't have to pay inheritance or death tax after your death on the money in allowance fund. If you don't put your additional money in annuity fund, then your folks will pay tax while inheriting that money.
When you put your cash in contractor pensions, you don't have to pay enormous amounts of IFA. This way, you'll be saving bunch of cash. The IFA charges only nominal piece of contractor taxes on your annuity funds.
Finally, it's easy to get tax relief on any fund that makes part of pensions. It can be direct investment in contractor pensions from your revenues or you can make your company send certain bit of your revenue to your allowance fun. Either way, it'll have similar results and you may finish up saving lot of cash from taxes. This tax relief can work miracles for most people looking to step down early with bunch of cash.
About the Author:
Ben Smith is lead writer for the Bedouin Group, who are leading in providing an Alternative choice to Umbrella Firms and Contractor Mortgage's