Turning Your Taxed Pension into a Tax Free Income Stream
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The document discusses various ways that Blackflame's Enterprise Investment Scheme (EIS) can be used to reduce and eliminate taxes, including income tax, inheritance tax, capital gains tax, and taxes on rental income and dividends. It provides examples of how investing pension funds and profits from a limited company into Blackflame's EIS can generate tax rebates and exemptions over time.
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Turning Your Taxed Pension into a Tax Free Income Stream
- 1. Brian Boyd
- 2. 3 WAYS TO AVOID PAYING INCOME TAX
- 4. 2) WORK BUT DONT TELL THE TAXMAN!
- 6. Using Blackflame’s EIS to Eliminate Income Tax £100,000 BLACKFLAME EIS Year 3 £30,000 UPFRONT TAX RELIEF £45,000 UPFRONT TAX RELIEF £45,000 UPFRONT TAX RELIEF £30,000 UPFRONT TAX RELIEF £30,000 UPFRONT TAX RELIEF £30,000 UPFRONT TAX RELIEF £150,000 BLACKFLAME EIS Year 6 £150,000 BLACKFLAME EIS Year 5 £100,000 BLACKFLAME EIS Year 4 £100,000 BLACKFLAME EIS Year 1 £100,000 BLACKFLAME EIS Year 2
- 7. Using Blackflame’s EIS to Eliminate Income Tax £15,000 BLACKFLAME EIS Year 1 £15,000 BLACKFLAME EIS Year 2 £15,000 BLACKFLAME EIS Year 3 £15,000 BLACKFLAME EIS Year 4 £22,500 BLACKFLAME EIS Year 6 £22,500 BLACKFLAME EIS Year 5 £6,750 UPFRONT TAX RELIEF £6,750 UPFRONT TAX RELIEF £4,500 UPFRONT TAX RELIEF £4,500 UPFRONT TAX RELIEF £4,500 UPFRONT TAX RELIEF £4,500 UPFRONT TAX RELIEF
- 8. Get out your calculators! £100,000 pension £25,000 tax free cash £75,000 taxed x 40% =£30,000 income tax £100,000 invested in Blackflame EIS £100,000 x 30% tax relief =£30,000 tax rebated
- 9. BLACKFLAME’S PENSION SOLUTION FOR TAX IMPLICATIONS 2015 1.Most tax efficient solution £400,000 pension fund £100,000 BLACKFLAME EIS YEAR 2 £100,000 BLACKFLAME EIS YEAR 3 £30,000 UPFRONT TAX RELIEF AGAIN INTO BLACKFLAME EIS £30,000 UPFRONT TAX RELIEF AGAIN INTO BLACKFLAME EIS £100,000 BLACKFLAME EIS YEAR 4 £30,000 UPFRONT TAX RELIEF AGAIN INTO BLACKFLAME EIS £30,000 UPFRONT TAX RELIEF AGAIN INTO BLACKFLAME EIS £45,000 UPFRONT TAX RELIEF AGAIN INTO BLACKFLAME EIS £9,000 UPFRONT TAX RELIEF INTO AN ISA £9,000 UPFRONT TAX RELIEF INTO AN ISA £9,000 UPFRONT TAX RELIEF INTO AN ISA £9,000 UPFRONT TAX RELIEF INTO AN ISA £13,500 UPFRONT TAX RELIEF INTO AN ISA £150,000 BLACKFLAME EIS YEAR 5 £100,000 BLACKFLAME EIS YEAR 1
- 10. Blackflame’s pension solution for tax implications April 2015 2. Most “De risked” Tax efficient solution £400,000 pension fund £150,000 AXA guaranteed bond £30,000 UPFRONT TAX RELIEF AXA guaranteed bond £30,000 UPFRONT TAX RELIEF AXA guaranteed bond £30,000 UPFRONT TAX RELIEF AXA guaranteed bond £30,000 UPFRONT TAX RELIEF AXA guaranteed bond £150,000 BLACKFLAME EIS YEAR 5 £100,000 BLACKFLAME EIS YEAR 4 £100,000 BLACKFLAME EIS YEAR 3 £100,000 BLACKFLAME EIS YEAR 2 £100,000 BLACKFLAME EIS YEAR 1
- 11. Year 8 4 years x £30,000 upfront tax relief into AXA =£120,000 4 years x £150,000 encashments into AXA = £600,000 Total = £720,000 Alternative for £400,000 pension fund taken in year one 25 % tax free = £100,000 £300,000 to be taxed added to your annual income
- 12. BLACKFLAME E.I.S. EXEMPT AFTER TWO YEARS FOR IHT £1,000,000 estate less £650,000 Nil rate bands =£350,000 liable for 40% tax =£140,000 IHT £1,000,000 estate less £650,000 two nil rate bands =£350,000 held in Blackflames EIS = No IHT to pay
- 13. WHY ARE THES OLD LADIES SUITABLE INVESTORS FOR BLACKFLAME E.I.S.
- 14. Both have a power of attorney over their assets with power of attorney you can not give client’s assets away to solve inheritance tax however, via POA they can invest in Blackflames EIS held in their own names this will be exempt if they live for two years . TWO YEARS AND ONE MONTH LATER THEY BOTH DIE FREE OF INHERITANCE TA
- 15. HOW TO EXTRACT PROFITS FROM A LTD COMPANY FREE OF TAX Nicholas is the director of a limited company and is a higher rate tax payer. He takes £50,000 out in dividends. £50,000 X25% tax paid on dividends =£12,500 £50,000 invested into Blackflame EIS X30% tax relief =£15,000 Nicholas does this for four years and then has £15,000 tax free income for life. VIA THE ROLL OVER INVESTMENT METHODOLOGY INTO BLACKFLAMES E.I.S. ENJOYING HIS TAX FREE INCOME FOR LIFE
- 16. Brian sells his cottage for £350,000 His capital gain is £100,000 He invests this in Blackflame EIS The CGT is deferred and Brian claims the tax back every three years using his CGT allowance He dies and the CGT is eliminated on his death. DEFERRING CAPITAL GAINS TAX
- 17. ATTENTION LANDLORDS Rental income can qualify for an Enterprise Investment Scheme Rental income is not classed as relative earnings for a pension
- 18. THANK YOU