Investors have until 31 January to take full advantage of the carry forward/carry back rules, after ...
Investors have until 31 January to take full advantage of the carry forward/carry back rules, after which they will be abolished for good.
The regulations, which are being removed by the Treasury, enable investors to maximise pension tax allowances.
Carry forward enables individuals to make use of pension allowances that have not previously been used, while carry back enables investors to make a contribution this year but to set it against previous years' earnings.
The rules have been particularly important to self employed people and company directors who want to contribute their maximum allowance but cannot do this until their accounts are finalised.
Others who have made use of the provisions are investors who qualified as top rate tax payers in the previous tax year and who didn't take their maximum allowance, but who are unlikely to fall into the top bracket this year.
Carry forward was abolished from 5 April 2001 but it can be used in conjunction with carry back up until 31 January 2002.
The measure allows investors to look back over the previous six years and mop up any unused allowances and set them against their 2000/1 tax bill.
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