Tax matters aren’t an immediate consideration when you are thinking of splitting up or divorcing, but they are an important consideration and being informed of any possible tax implications is a wise move. In this article, we delve into what you need to know. 

Capital Gains tax 

If you are ending a marriage or civil partnership, you and your former partner are likely to have marital assets that you will need to split. This could be the family home, pensions, investments or business interests, for example. In some instances, you may be liable to pay Capital Gains Tax (CGT) however, whether you pay this or not hinges on the timing of the transfer of your assets.

New laws on Capital Gains Tax 

The laws on CGT changed in April 2023 in a bid from HMRC to make things ‘fairer’ for divorcing spouses and separating partners. Prior to the new change, the rules on CGT and the transfer of assets were based on the date a couple separated officially. They had until the end of the tax year they split up, to make a ‘no gain no loss’ transfer of assets. This meant that the transaction made is considered to incur neither a loss or a gain. After this window of time, the couple had to pay Capital Gains Tax and the assets would be considered at current market value. 

Essentially, the new rules have extended the window spouses and partners have to transfer any matrimonial assets with CGT consequences. Now, couples have three years following the time when they ceased living together as a couple. The idea behind the new rule is to make matters more simple, less burdensome for couples already going through a difficult and emotional period. Prior to this, when assets such as the family home took a while to sell, a strain was put on divorcing spouses. Although it has now alleviated some of the potential stress and urgency, it is still prudent to think ahead and consider the length of time the sale of assets may take.

Inheritance tax 

Asset transfers during a divorce or dissolution are not subject to inheritance tax, and this remains the case until the Decree Absolute is granted. However, it’s worth noting that £325,000 is the maximum amount you can transfer tax free from a spouse who is UK domiciled, to one who isn’t. If a transfer is higher than this amount, or made following the Decree Absolute, they are considered Potentially Exempt Transfers (PET). This is an exemption which allows for someone to make a gift of an unlimited value to another, without having to pay inheritance tax, if the gifting party lives for a further seven years. 

Income tax 

The income tax position of a divorcing couple should not change as a result of a divorce, with each party being treated independently. No tax is payable on any maintenance payments and by the same token, there is no tax relief available from the party who is making the maintenance payments. If you have transferable assets that generate income, such as stocks, shares or bonds, or other investments they will be considered a taxable income for the person in receipt of them. 

Summary 

The division of assets can become complex during some divorce proceedings, and as such, taxation can also become complicated. This is particularly the case if one of both parties have high value assets, or assets overseas. Seek legal advice as early on in the process as you can to avoid any unpleasant surprises. Divorce and separation can be costly so it’s important to know where you stand as soon as you can to help you plan and make good decisions on your financial future. 

A common misconception is that only the extremely wealthy have a need for wealth managers. But wealth managers offer a range of services and can help a variety of clients grow their finances through a series of smart investments.

Wealth managers help individual clients, corporate clients, charities, trusts and estates. Key services offered by wealth managers include investment management, stockbroking, pension investment planning, stocks and shares ISAs, inheritance tax planning and more. In this article, we highlight the five key signs that indicate you may be ready to hire a wealth manager.

You Are Planning For Retirement

Heading into retirement is an excellent time to think about hiring a wealth manager. With the help of an experienced financial professional, you will be able to build a solid retirement fund through a range of options tailored to you, including ISAs, personal pension investments and more. With the right investments and guidance from an expert, you may be able to set up future generations. Having a wealth manager can also help if you are approaching the pension contribution limit.

You Need Tax Planning

Whether it is income tax, inheritance tax, capital gains tax or a mix of the three, your tax bill may seriously be starting to hurt your finances. As part of preserving and expanding your wealth, an experienced wealth manager will minimise your tax obligations through a series of options, including taking advantage of tax incentives on specific types of investments.

Inheritance tax, for example, can be reduced through investment in a diversified portfolio allowing you to ensure an effective transfer of wealth to future generations.

Your Investments need Diversifying

Speaking of diversifying your portfolio of investments – this is one of the key reasons many people hire a wealth manager. Without the help of a professional investment manager, many people miss out on smart investment opportunities that could diversify their investment portfolio.

An experienced wealth manager will work closely with you to understand your circumstances and financial goals for the future. They will then put forward smart investments that are tailored to your requirements and financial goals, whilst simultaneously adjusting investments as the market conditions alter.

You Need Asset Protection & Risk Management

Unless you have a wealth of investment experience, it can be easy to make risky decisions that negatively impact your wealth. And once a risky investment has been made, it can be challenging to reverse it. Hiring a wealth manager can give you peace of mind that your assets are protected and that any investments made have been handpicked for you with all risks taken into consideration and discussed.

You Lack The Time

Managing your investments and protecting your hard-earned assets is a time-consuming and often frustrating process. Hiring a wealth manager will give you back the time you need to focus on your other priorities, be it your family, career or personal pursuits. With communication as and when required, your wealth manager will take care of your investments and asset protection through a series of services tailored to you.

In the vast realm of digital banking, where financial institutions strive to stand out amidst immense competition, one London-based company has emerged at the forefront. 

Black Banx, a global digital banking company founded on a commitment to unlocking a borderless financial system for everyone where money can flow freely, has not only disrupted the industry with its innovative services but has also proven that “culture is king” when it comes to delivering exceptional customer experiences.

When the Landscape Changed for Good

Founded in 2014 by German billionaire Michael Gastauer, Black Banx officially entered the market in 2015. It soon captured the attention of millions around the globe. 

Since its launch, the banking juggernaut has spread its reach quickly and, as of the end of 2022, operates in a staggering 180 countries. With such a global presence, it’s no surprise that Black Banx has amassed an impressive customer base of 20 million retail customers and 1.5 million business customers. 

As remarkable as this growth has been, Gastauer openly admits that it wouldn’t have been possible without the dedication and expertise of Black Banx’s now over 3,000 talented employees who proudly call the company their professional home.

Company culture at the center of the Banx

At the heart of Black Banx’s success lies its unwavering commitment to fostering a vibrant and dynamic culture. 

The company firmly believes that the best people, working together in an environment that nurtures their talents, are the key to delivering unparalleled services and products to customers. 

In an era where financial institutions often become faceless and at times emotionless giants both externally to the market and even internally to its own professionals, Black Banx strives to create a workplace defined by creativity, collaboration, and camaraderie.

Not just heard, but listened to

Black Banx’s company values not only encourages its employees to speak up but also considers it a core responsibility. 

The company understands that an open and inclusive culture, where diverse voices are heard and respected, is crucial to driving innovation and pushing boundaries. It does, after all, serve in hundreds of markets where the cultures are just as varied as the digital banking needs and preferences.

At Black Banx, employees are far from being mere cogs in the machine; they are valued members of a team where challenging the status quo is not only welcomed but actively encouraged.

Talent diversity is key

Indeed, diversity is as good as a given at Black Banx. 

Gastauer and company have always recognized that a diverse workforce, comprising individuals from all walks of life, brings forth a variety of ideas, perspectives, and experiences that lends itself well in the understanding of the financial requirement needs of people around the world and subsequent development of new products and services to meet those said needs. 

By embracing diversity, Black Banx not only reflects the multicultural world it serves but also strengthens its ability to be relied upon by its customers across the globe.

All Hands on Deck

In line with Blank Banx embracing diversity and accepting differences is the collaborative effort of achieving common goals.

Collaboration is the lifeblood that courses through the company’s veins, fueling innovation and driving breakthroughs by bringing together the best that each individual has to offer.

The teams of thousands at Black Banx work seamlessly across departments and borders, united by a shared vision of redefining the banking experience, and encouraged to share their perspectives, ideas, and feedback as individuals. 

This commitment to collaboration ensures that customers receive the utmost attention and care, no matter where they are in the world.

Breaking barriers: Black Banx’s vision for the future

As Black Banx continues to make waves in the digital banking universe, it remains steadfast in its commitment to a brighter future. 

With a brand voice that echoes progress and inclusivity, Black Banx envisions a world where financial services, and careers in it are accessible to all. This, irrespective of a person’s background or location. 

This socially conscious approach is woven into the very fabric of the company, as it works tirelessly to break down barriers, starting with its own workplace, so that it can soldier on ahead with a united front to make a positive impact on the lives of its customers.