Newspaper article The Journal (Newcastle, England)

Q&A; Your Money Queries Are Answered by TREVOR CLARK, Director of Rutherford Wilkinson Ltd, Chartered Financial Planners

Newspaper article The Journal (Newcastle, England)

Q&A; Your Money Queries Are Answered by TREVOR CLARK, Director of Rutherford Wilkinson Ltd, Chartered Financial Planners

Article excerpt

QI have recently received a sizeable bonus and I am considering investing it into a Stocks & Shares ISA. I plan to invest the maximum amount this tax year and the balance in April, once the new tax year commences. Do you think it is a good time to invest in the stock market? A You have obviously given this some thought. The maximum ISA allowance for the current tax year is pounds 10,680 (of which pounds 5,340 can be invested in a Cash ISA). That allowance will increase on 6 April, when the new tax year starts, to pounds 11,280 (of which pounds 5,640 can be invested in a Cash ISA).

Whether or not this is a good time to invest depends upon a number of factors, including your attitude to risk and your time horizons. While many commentators are suggesting that the stock market offers good value at present, it could go considerably lower before it improves.

I urge you to seek quality independent financial advice before you make any investment, so that you can be certain that you appreciate the risks involved and that you are comfortable taking those risks.

QI am in my 60s and have recently suffered a heart attack. As a result, I am looking to sell my business so I can retire. I appreciate that this may not be the best of time to sell, but I want to make the most of my retirement. The company is trading well and has made a profit every year, even during the recent recession. I expect to receive a significant sum for the business. Can you give me an indication of what my tax liability is likely to be? A First, I'm sorry to hear of your ill health and wish you all the best for your retirement. The sale of the company will be subject to capital gains tax. The rate at which you pay capital gains tax depends upon your total taxable earnings in the relevant tax year. The current rate is 18% on total earnings up to the basic/higher rate threshold and 28% above that. From the information you have provided it seems safe to assume that you will pay capital gains tax at the rate of 28%.

However, you may well qualify for Entrepreneurs Relief. There are a lot of detailed qualifications but, in a nutshell, provided that the business has been "trading" and you have owned it for at least one year, you are likely to qualify for Entrepreneurs Relief. …

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