Financial Focus: The only certainty in life is death and taxes
Several famous authors have uttered lines to this effect. The first was Daniel Defoe, in The Political History of the Devil, 1726
In 1696, William III of England introduced a property tax that required those living in houses with more than six windows to pay a levy. In order to avoid the tax, house owners would brick up all windows except six. (The Window Tax lasted until 1851, and older houses with bricked-up windows are still a common sight in the U.K.) As the bricked-up windows prevented some rooms from receiving any sunlight, the tax was referred to as “daylight robbery”.
During July 2020 we had a mini budget designed to assist the young obtain work, subsidies for energy efficiency, and more. We will also have an autumn budget in October, and it should be an interesting one. Many ponder how as a country we will afford to pay for all the fiscal stimulus taking place and proposed. Rumours and suggestions abound but one thing I do not expect is a window tax!
Tax as we know it is fair, and to coin another phrase “we must pay Caesar what Caesar is due”, however this does not mean you should not plan and mitigate unnecessary taxation. For example, I understand many do not use the attractive allowances, whether they be investment products such as ISA’s or estate planning, so inheritance tax which is named a “ voluntary tax” since much can be arranged so beneficiaries are protected. Perhaps we become lethargic or leave the planning to another day. These things are too taxing to spend time with… “I will get round to it”.
Yet a huge percentage of the country waste yearly allowances, do not even have the basics of a Will, and just “hope for the best”.
Do not leave it too late? Covid-19 has shown us all we must make each and every day count. It ravaged the world without care for Prince or Pauper – and it will probably be around for a long time yet whether in its current format or in a mutated format. The latter more dangerous as a variant could be vascular along with the respiratory version. (Source: New York Genome Centre July 2020)
It is good to talk. We have heard this time and time again for mental health issues and other matters – it applies to your financial health and welfare too. Talk to your advisers, learn, find out more…take action. This is when their skill should shine! You need them when the seas are rough as well as smooth…
Written By: Jacqueline Lee-Lis LLB (Hons), APFS, EFP
Chartered Financial Planner | European Financial Planner – www.financialobserver.co.uk