Bearing in mind the new high rates of tax on income over £100,000 or taxable income over £150,000 it might be possible to accelerate income into 2009/10 to reduce or eliminate the impact of the new higher rates, by drawing down additional dividends or paying or voting additional salary or bonus.
Accelerating income will, however, have the downside of accelerating the tax payments on that income, but if you are likely to be liable at either 50% or 60% effective rates, then this is worth considering.
The interaction with the new pensions forestalling legislation must not be overlooked, however.
You may consider that pension payments and donations to charity would benefit you more in 2010/11 than in 2009/10, so it may also be worth delaying these. Before making any decisions about pension contributions you will need to take specific detailed advice if your income in 2009/10 or either of the two preceding years exceeds £130,000.
Tags: higher tax rate, National Insurance Contributions, Payroll
