Adviser - Winter 2018

How visiting a retrospective of Picasso enabled Faye Howard , Scrutton Bland’s Tax Director, to appreciate how seeing the bigger picture is so important to our Private Client Service. T he Tate Modern recently held an exhibition of works by Picasso all created in 1932. The exhibition featured over 100 paintings, sculptures, and drawings, some Whilst we are very happy to provide standalone tax, or financial advice when required, in the right circumstances, there can be so many benefits of taking joined up advice covering both tax and investment angles. For example, Another example might be a client wishing to give away an asset to a child or grandchild, but feeling unable to do so because the gift is likely to trigger a liability to Capital Gains Tax. There are a number of ways that this issue could be solved, but if the individual making the gift also has an Income Tax liability, a potential solution

of which had never been exhibited together before. I must confess that I have never been much of a Picasso fan, and on seeing my first original Picasso (Woman with Yellow Hair) last year, I felt quite disappointed. I’m not sure exactly what it was I was expecting to see, but I think I was expecting to feel something to reflect the fact that I was looking at what many consider to be a great work of art. When I heard about the Tate exhibition earlier this year, I decided to visit, just to see whether my opinion of Picasso might change, and I have to admit that it really did. Whilst Picasso will probably never be my favourite artist, my visit to that exhibition allowed me to see these famous works in context. Instead of viewing a standalone work, I could see the bigger picture, quite literally, and with that overview came a degree of understanding, followed closely if not by a great love for these works, certainly (to my surprise) a real appreciation of them. Having that context and wider knowledge of the artist and his life was important in gaining an understanding of what was essentially an abstract picture, and I couldn’t help but relate that back to how we work with many of our clients at Scrutton Bland.

we’ve been running our own exhibitions recently in the form of Inheritance Tax roadshows, and often as a result of this we will meet with couples looking to plan to reduce their exposure to IHT. Now whilst client objectives may well be similar, how those objectives are achieved can differ wildly between clients, that’s part of the art of what we do. In order to advise properly on how each client’s objectives can be achieved, it’s very important that we get that context to enable us to see the bigger picture. This will often involve a review of investments, Income Tax and Capital Gains Tax, and the beauty of our joined up service is that this can all be done at one meeting with an Independent Financial Adviser and a tax adviser, at the same time. Often, although a client may have come to us seeking advice on their IHT position, we are also able to suggest tax savings in other areas. For example, a pensioner with ISA investments who is also drawing income from a Self Invested Pension Plan (SIPP), may be well advised to cease drawing funds from that pension and spend capital from the ISA instead. This will retain the maximum value in the IHT free pension environment, whilst depleting the ISA’s which would be subject to an IHT charge on death. An added bonus is that as capital is being drawn from investments rather than from a pension, that individual’s income is reduced, consequently so is the amount of Income Tax that they will pay.

could be an Enterprise Investment Scheme investment. Such an investment would allow for deferral of the capital gain, give 30% of the amount invested as Income Tax relief, and provide exemption from IHT for the amount invested once the investment has been held for just a 2 year period. These are just two very simple examples of fairly common situations that we see, but they are ideal situations for our joined up approach because of the way in which financial advice and tax advice dovetail together. To take the analogy back to Picasso, either an IFA or a tax adviser can draw an outline, but it’s really only when the two work together that the colour is added and the picture comes to life. Whilst we can’t promise to save you enough money to buy your own Picasso, what we can do is to help you protect the assets you do have with the art of joined up advice.

For further information on our joined up tax and financial planning service, please contact Faye Howard on 0330 058 6559 or email faye.howard@scruttonbland. co.uk

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