There are over 213.8 thousand healthcare physicians employed in the UK, and we can only anticipate that this number has increased. We might not have the exact number of practitioners in this industry, but we can all agree that no one in any profession enjoys paying taxes. Fortunately or unfortunately, we all have to do it.
Additionally, it’s not unusual for high-income physicians to owe thousands in taxes each year. It’s true what they say: “the more you make, the more they take.” But you can employ many strategies to aid in tax deduction and wealth management.
It all starts with tax planning.
Unfortunately, there is little to no education on personal finance or tax planning. There are many different aspects to financial planning, and tax plans are subject to change. Depending on your taxable income and work situation, they can develop and vary over time.
Additionally, as tax regulations change every year, what would be included in your plan one year might not be the case the following year. That’s why it’s vital to engage an expert to stay current on the legislation, including the tax credits, deductions, and exemptions you qualify for.
We recognize that it is nearly impossible for a physician who works long hours to be thoroughly knowledgeable about the tax code, how it operates, and how it might help or hinder them.
That is why Pearl Lemon Accountants‘ team of tax and financial consultants is available to assist you in staying up to date with the legislation. To help maximize deductions for the year, our experienced financial experts will develop a tax strategy to help walk you through these nuances and advise you on the best course of action.
If you’re prepared to begin arranging your taxes. Call Us Right Now.
The best course of action for most physicians and medical professionals is to employ physician tax solutions that reduce or even eliminate their taxes.
Our tax planning specialists for physicians can offer extra chances for tax reduction that can:
If you’re ready to start planning for your future, here are five tax planning strategies you can develop.
Planning your taxes involves more than just minimizing your current-year tax liabilities. Optimizing your tax efficiency once you retire is another consideration.
Diversifying your investments is one way to do this.
You need to review each of your bank accounts to diversify your investments. Look over your taxable, tax-favoured, and tax-deferred accounts. You can reduce your tax burden during retirement by dividing your investments(income splitting) among several accounts.
Spread your funds over several different accounts for social security and diversify your investments so that you’ll be in the best possible financial position when you reach retirement age.
You must lower your taxable income to pay less tax and keep more of your earnings for yourself. However, that does not imply that you should work less or make less money. It simply means you must reorganise your contributions and income to reduce your taxable income.
Donating stocks from investment accounts to charities is one strategy to lower your taxable income. Investment donations, as opposed to cash donations, provide a double tax benefit. In addition, leveraging chances for tax-loss harvesting is another approach to lower your taxable income. You can sell a lost investment and realize the loss using tax-loss harvesting.
The taxes you owe will decrease directly to how much less your income is taxable. And to do that, you should maximize your deductions as much as possible.
Most homeowners deduct their house mortgage interest, but if you have a home equity line of credit, ensure you also deduct the interest on that line of credit.
While a cash-out refinance from your mortgage is tax deductible, your student loan interest is probably not because you are a high-earning physician. If you owe money for medical school, think about refinancing your house so you may deduct the interest from your taxes.
Additionally, some physicians can be eligible for tax benefits. You might be able to claim credits for adoption fees, continuing education charges, and energy-efficient home upgrades.
The greatest strategy for tax planning is to work with qualified experts. With a good plan in place, a team of professionals can examine your tax situation.
You should have the following three types of pros on your team:
Financial advisor: Who will work with you to develop a sound financial strategy. This strategy will lessen your tax liability the following tax year, diversify your investments, and lower your taxable income.
A CPA or an accountant: Who will track and monitor all of your costs during the year. This will simplify taking full advantage of corporate and personal deductions.
A tax specialist: Who will handle your actual filings. They’ll ensure you claim the appropriate deductions and benefit from any tax credits you qualify for. Tax professionals keep up with changes to the tax code and are familiar with the current legislation, saving you trouble. They can guide you so that you can save as much money as you can.
The aim is not to save money on taxes for just one year. The main objective is to develop a long-term strategy to help you reduce your tax liability by creating a thoughtful, long-term plan. More importantly, you’ll be able to keep more of your earnings for yourself throughout your working years and retirement.
Hiring a certified tax coach is essential, especially if you’re a physician. All professions need to plan their taxes, not only during the tax season. Physicians must do so because they frequently have a large tax bill at the end of every year.
Now is the time to create an effective tax plan. To speak with a consultant who can put your strategy into action and set you up for future financial success, get in touch with Pearl Lemon Accountants.
Please speak to us for all of your tax planning professional services.
HMRC investigations aim to determine whether accurate information has been given and whether accurate taxes have been paid.
You shouldn’t worry if you made an honest mistake because HMRC has several programs to help you, including Time to Pay.
Consider employing a specialised tax accountant if you don’t already have one. It’s the same reason you wouldn’t try to fix your boiler yourself.
In this situation, expert help is essential. Accountants who specialise in tax investigations will help you complete your tasks with the least amount of stress and on schedule.
With personal tax services, our professionals will advise you on every part of your tax status to ensure you comply with all legal and regulatory obligations. We offer a customised solution that covers everything from straightforward tax filing to filing for individuals with incredibly complex UK tax concerns.
Ensure that you research before hiring a professional to ensure they have the proper licenses and credentials. That’s why when you consult with us, we give you the leverage to ask us any questions you might have, and we will be glad to answer.
To conduct successful tax planning, crucial customer data must be obtained.
This process involves two steps. First, the unique characteristics of each available tax plan are considered in light of your specific circumstances (given in step 1).
We rely on a database of more than 250 tax planning strategies. Then secondly, based on our expertise, knowledge, and experience, we select up to 10 of the best tax planning options for you.
This report shows the tax savings realized by utilizing the selected tax strategies and the specific procedures necessary to implement each strategy legally and successfully (including the cost).
We then review the tax savings report and the implementation procedure with you to fully inform you of your options. We can also put the techniques into effect if you desire to go further.
Tax compliance and tax planning are two distinct concepts.
Your accountant will attempt to maximize your refund or savings on tax compliance by claiming appropriate deductions that you can prove.
On the other hand, tax planning is a comprehensive service that examines the alternative solutions you have to generate savings and the necessary action/steps to grow those tax savings.
When you allow us to keep track of your finances, you give yourself more time to do your work and please more clients.
It's a win-win situation for everyone.
Aside from that, you'll also gain financial stability because your assets and liabilities are managed well enough not to cause any trouble for you in the future.
So let our experts work for you, and you won't regret it even a bit.
Book a call today to get started.