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New research from Bancroft Wealth, a UK wealth manager, suggests that ‘tax’ may just be the dirtiest word in financial planning, with a majority of investors believing there’s nothing that can be done to reduce their tax burden, and a third saying that the only way to do this would be by breaking the law.

However, the wealth manager – which has reduced its customers’ on-going advice fees by over £6k a year on average – is urging investors to rethink their approach to tax planning, and realise that far from being a source of shame, being efficient with their tax affairs is a legitimate and important part of wealth planning.

How can you reduce your tax burden?

Over a fifth (22%) of UK investors said they’d be more likely to consider reducing their tax bill if it was cheaper to speak to a qualified tax adviser. Hardly surprising as a significant proportion (12%) think that you’d have to pay at least £10k for this sort of service.

One in six (16%) wished it was easier to speak to a qualified tax adviser over the phone or online, while a fifth would be more attracted to tax planning if they knew how much they could save (26%) and had a better understanding of the methods that can be used to reduce tax (23%).


One in ten (11%) were very honest, admitting that they wished tax was less boring. And 9% said that they’d be more willing to review their tax situation if there was less shame around the subject.

Tax planning is getting a bad rap

Keir Ashman, pensions and investments specialist at Bancroft Wealth, told us:

“Our survey suggests that tax planning has a bad reputation, with some investors considering it to be illegal and many believing that it’s simply too boring or too expensive to even think about. But I think people are confusing tax efficiency with tax evasion. Tax evasion rightly receives a huge amount of negative publicity because it’s illegal, immoral, and abused by the very wealthiest in society – billionaires and global corporations with less scruples than most.”

Ashman says it’s time that people realised that being smart about their tax affairs is nothing to be ashamed of. A significant number of people either don’t know how to tackle their tax situation, or assume that accessing qualified advice is difficult and expensive. “But it really doesn’t need to be, and it certainly shouldn’t cost the £10k plus that a lot of investors assume it will,” he argues.

Reducing your tax liability

Investors taking part in Bancroft Wealth’s survey were informed that it is possible to reduce their tax liability legally, and were then asked to choose which methods of doing so they thought were legal.

Alarmingly, some of the most common tax-efficiency tools received a much smaller share of the vote then expected.

For example, while more than half (57%) believed that putting savings into an ISA is legal, this suggests that more than two fifths were unsure. A similar response was made for pensions (56%) and using capital gains allowances (41%).

And one in six (17%) said that none of the legitimate methods for reducing someone’s tax burden were legal.

Ashman added:

“I was shocked to see how many investors in our survey thought that completely legal ways to reduce the amount of tax that someone pays were somehow criminal. This suggests either a big problem with how these tools are promoted, or that associating them with ‘tax efficiency’ makes them seem immoral. In reality, tax planning is really just about paying what you need to based on the rules that exist. The government itself comes up with tax efficient schemes like ISAs, pensions, premium bonds, capital gains allowances, inheritance tax allowances and the like. Making use of these is not sneaky or underhand, and certainly isn’t illegal.”

What next for tax planning?

Other than moving from advice firms that charge percentage fees, one of the quickest and easiest ways that Bancroft Wealth’s clients have improved their financial position is through tax planning. For example, one client saved over £100k in tax liabilities simply by registering for a Government scheme to let them maximise their pension lifetime allowance. As such, Bancroft Wealth says it wants to see the narrative around tax planning change, so that less people are put off from pursuing legitimate tax efficiency methods.

Says Ashman:

“Taxation keeps public services running and makes for a resilient economy, so it’s right to vilify those who dodge their liabilities. But we want to see more people benefitting from efficient tax planning so that, while they continue to pay their dues, they can also maximise their wealth potential. I’d urge anyone who is unsure about tax, how it applies to them, and how they can maximise their investments, to speak to a qualified financial adviser or wealth manager.”

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Please note this article does not constitute investment advice. Investors are encouraged to do their own research beforehand or consult a professional advisor.

Stuart Fieldhouse

Stuart Fieldhouse

Stuart Fieldhouse has spent 25 years in journalism and marketing, including as a wealth management editor for the Financial Times group, covering capital markets and international private banking, and as an investment banking correspondent for Euromoney in Hong Kong. He was the founder editor of The Hedge Fund Journal.

Stuart has worked at CMC Markets, supporting the re-launch of its global financial spread betting and CFD trading platforms. He is also the author of two books on trading, published by Financial Times Pearson. Based in The Armchair Trader’s London office, Stuart continues to advise fund managers, private banks, family offices and other financial institutions.

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