10 Ways To Save On Tax In 2021-22
- Tom Church, Co-Founder of LatestDeals.co.uk, a money-saving community with over 1.8 million members, provides his top 10 tips for saving money on tax in the new financial year
- He highlights how simple tricks such as checking your tax code and making the most of employer schemes can result in huge savings
- Points out the common mistakes which are costing people money, such as being on an emergency tax code or not claiming credits they’re entitled to
The new tax year means there are new figures to get to grips with, such as different tax codes, personal tax changes and different tax thresholds. While this can all sound confusing, the upcoming months can bring in plenty of savings for those who are savvy about their tax options.
‘People may automatically switch off at the mere mention of tax, but there are many opportunities to save every time a new tax year rolls around’, says Tom Church, Co-Founder of money-saving community LatestDeals.co.uk. ‘A little research online can result in huge savings, which is why we’ve launched a series of in-depth consumer guides to help people learn more about tax without getting bogged down in jargon.’
‘Our latest guides, Tax Codes Explained and How To Claim a Tax Refund, are aimed at those who want to inform themselves about how tax works and learn how they can make their money stretch further.’
Here are Tom’s tips on how to make tax work for you...
Check if your code is accurate
“The start of a new tax year means that your payslip may feature a different tax code. Guidance from HMRC details these changes - for example, if your code was 1250L, it may now be 1257L. If your code looks wildly different to the last one, it’s worth checking in with your HR or finance department to check your details are up to date. In some cases, you may qualify to pay less tax in the immediate future - or even to claim a rebate if you were on an emergency tax code.”
Submit a claim for a tax rebate
“Each year, HMRC will work out if you have paid the right amount of tax through the P800 tax calculation submitted by employers or pension providers. However, if you haven’t been on the right tax code, or your circumstances have recently changed, you can get in touch with HMRC to see if you’re able to submit a manual claim for a tax rebate. Make sure you have all of your documents at the ready!”
Check if you’re eligible for a tax refund
“There are many situations where people can claim a tax refund. Self employed people can claim expenses such as buying office equipment or heating their office, and employees can claim expenses such as education or uniforms. Those who are working from home and had to buy a new laptop or computer for professional purposes may be able to get 20% of the total expenses back! The government site has an online service for people to check their eligibility.”
See if you qualify for a tax credit claim
“Tax credits have been replaced with Universal Credit, so claims for Working Tax Credit and Child Credit can only be made by those who already get tax credits. Claims will automatically be updated up to 31 days. However, tax credit claims can be backdated by more than 31 days if you apply within a month of receiving refugee status or within 31 days of qualifying for a benefit such as Personal Independence Payment or Disability Living Allowance.”
Contribute to your pension scheme
“Most people will automatically be enrolled in their employer’s pension scheme. However, voluntary contributions can be made from your gross pay before tax is applied. The government will give you a free bonus for saving for your retirement by topping it up with tax relief!”
Claim marriage tax allowance
“Married couples can enjoy the perk of marriage tax allowance if one person earns less than the personal allowance. People can transfer their unused personal allowance to the higher earner, which means huge savings can be made.”
See if you can claim back National Insurance
“If you’ve had more than one job in a 12 month period, it’s likely you paid more National Insurance than you needed to. In such a situation, you can go to the government website and fill out the claim for a National Insurance refund.”
Check if your car is exempt from car tax
“There are a number of car tax exemptions for which can save you money. For example, cars owned by a person with disability or those which produce 0 grams of CO2 emissions may be eligible. The full list is available on the government website - just don’t forget to apply for tax anyway so that the DVLA knows payments don’t need to be made.”
Claim on tax-free childcare
“The tax-free childcare scheme lets people claim 25% of their childcare costs back, which means they can get up to £500 back every 3 months! Check the government website to see if you qualify, as conditions such as having a child under 11 and meeting the earning threshold apply.”
Ask your employer about the salary sacrifice childcare scheme
“It may seem counterintuitive, but the salary sacrifice scheme involves employees giving up a portion of their pay each month in order to benefit from a perk such as higher pension contributions. Other benefits such as bus passes are also on offer depending on which schemes an employer may have available. The salary which is sacrificed won’t have tax or National Insurance contributions deducted if employees opt for perks such as employer-provided childcare, bicycles, ultra-low emission vehicles and additional annual leave. If your employer isn’t enrolled in the scheme, why not ask if they’d be willing to sign up?”
Save More With These Discount Codes