e the deposit savings in their name. For example, if you have ?50,000 in a deposit account and are paying 40% tax on this, you'll only be earning ?900 pa on 3% gross interest. If this is in the name of the non-earner you'll get another ?600 in interest. The non-earner can apply for the money to be paid gross by completing form IR85, available from your tax office.

3. Linked to the above tip, you should al

Well, here we are again.

The start of a new tax year is upon us, bringing with it many opportunities to save tax (legally) and keep as much of your money in your hands, and away from Gordon Brown's.

The budget was a bit of a damp squib, so let's look at some of the best ways to save tax!

Now, it's possible you've heard of some of these ideas, but are you actually using them? I've heard many clients say they've heard of something, then admit they've done nothing about it. Don't let this be you...

On with the tips.

1. Use an offset mortgage to reduce the amount of tax you pay on your deposit savings. If you have, say, ?20,000 in a deposit account and it's earning interest of 3% AER, the gross amount is ?600. There's a further ?120 (20%) taken in income tax at source, plus another ?120 tax if you're a higher rate taxpayer. Therefore, the net interest is only 1.8%.

Now let's say you have a mortgage of ?100,000 at 5% interest, meaning you're paying ?5,000 pa to service the loan.

Now you place the ?20,000 in an offset account, which means that you're now paying interest on ?80,000, which is ?4,000 pa.

Let's see what you've achieved. You WERE earning ?360 pa interest on the ?20,000. Now you're saving ?1,000 pa on the mortgage payment, giving you a net gain of ?640! You would actually need another ?36,000 in deposit savings to equal the offset savings.

The other plus is that you now don't have savings interest to declare on your tax return.

2. If you don't want a flexible mortgage, or don't have a mortgage, you can still save tax. If your spouse is not working and has no income you should place the deposit savings in their name. For example, if you have ?50,000 in a deposit account and are paying 40% tax on this, you'll only be earning ?900 pa on 3% gross interest. If this is in the name of the non-earner you'll get another ?600 in interest. The non-earner can apply for the money to be paid gross by completing form IR85, available from your tax office.

3. Linked to the above tip, you should al

say they've heard of something, then admit they've done nothing about it. Don't let this be you...

On with the tips.

1. Use an offset mortgage to reduce the amount of tax you pay on your deposit savings. If you have, say, ?20,000 in a deposit account and it's earning interest of 3% AER, the gross amount is ?600. There's a further ?120 (20%) taken in income tax at source, plus another ?120 tax if you're a higher rate taxpayer. Therefore, the net interest is only 1.8%.

Now let's say you have a mortgage of ?100,000 at 5% interest, meaning you're paying ?5,000 pa to service the loan.

Now you place the ?20,000 in an offset account, which means that you're now paying interest on ?80,000, which is ?4,000 pa.

Let's see what you've achieved. You WERE earning ?360 pa interest on the ?20,000. Now you're saving ?1,000 pa on the mortgage payment, giving you a net gain of ?640! You would actually need another ?36,000 in deposit savings to equal the offset savings.

The other plus is that you now don't have savings interest to declare on your tax return.

2. If you don't want a flexible mortgage, or don't have a mortgage, you can still save tax. If your spouse is not working and has no income you should place the deposit savings in their name. For example, if you have ?50,000 in a deposit account and are paying 40% tax on this, you'll only be earning ?900 pa on 3% gross interest. If this is in the name of the non-earner you'll get another ?600 in interest. The non-earner can apply for the money to be paid gross by completing form IR85, available from your tax office.

3. Linked to the above tip, you should al

're a higher rate taxpayer. Therefore, the net interest is only 1.8%.

Now let's say you have a mortgage of ?100,000 at 5% interest, meaning you're paying ?5,000 pa to service the loan.

Now you place the ?20,000 in an offset account, which means that you're now paying interest on ?80,000, which is ?4,000 pa.

Let's see what you've achieved. You WERE earning ?360 pa interest on the ?20,000. Now you're saving ?1,000 pa on the mortgage payment, giving you a net gain of ?640! You would actually need another ?36,000 in deposit savings to equal the offset savings.

The other plus is that you now don't have savings interest to declare on your tax return.

2. If you don't want a flexible mortgage, or don't have a mortgage, you can still save tax. If your spouse is not working and has no income you should place the deposit savings in their name. For example, if you have ?50,000 in a deposit account and are paying 40% tax on this, you'll only be earning ?900 pa on 3% gross interest. If this is in the name of the non-earner you'll get another ?600 in interest. The non-earner can apply for the money to be paid gross by completing form IR85, available from your tax office.

3. Linked to the above tip, you should al

saving ?1,000 pa on the mortgage payment, giving you a net gain of ?640! You would actually need another ?36,000 in deposit savings to equal the offset savings.

The other plus is that you now don't have savings interest to declare on your tax return.

2. If you don't want a flexible mortgage, or don't have a mortgage, you can still save tax. If your spouse is not working and has no income you should place the deposit savings in their name. For example, if you have ?50,000 in a deposit account and are paying 40% tax on this, you'll only be earning ?900 pa on 3% gross interest. If this is in the name of the non-earner you'll get another ?600 in interest. The non-earner can apply for the money to be paid gross by completing form IR85, available from your tax office.

3. Linked to the above tip, you should al

e the deposit savings in their name. For example, if you have ?50,000 in a deposit account and are paying 40% tax on this, you'll only be earning ?900 pa on 3% gross interest. If this is in the name of the non-earner you'll get another ?600 in interest. The non-earner can apply for the money to be paid gross by completing form IR85, available from your tax office.

3. Linked to the above tip, you should also make sure you're getting the best interest rate on any deposit savings. ING are currently paying 4.5% AER. So, if you duplicate the example above, you'd earn ?2250 pa. When compared to the original figure of ?900 pa, this is an increase of 150%!

4. If you employ your spouse in your practice, there's a way in which they can potentially qualify for a basic state pension, without paying National Insurance. If you pay them less than ?84 pw they don't qualify for the pension. If you pay them more than ?84 and less than ?97 pw they will qualify for basic state pension.

Any employment of a spouse must be done on a commercial basis and you should qualify and confirm this with your accountant or the Department of Work and Pensions.

5. Use the new pension rules to boost your retirement funds. For the 2006/07 tax year you can contribute up to ?215,000 to your pension and receive full tax relief, or 100% of your earnings if lower. If you're self employed this is particularly useful to reduce your tax bill. Remember, if you're a higher rate taxpayer you'll get 40% relief on your contributions.

6. Buy Pension Term Assurance instead of 'normal' life assurance. If you have, or are considering buying life cover, you can now get tax relief on your contributions. So, instead of paying ?100 pm for protection, you may be able to get the same level of cover for ?60 pm. Over a 20 year term this amounts to ?9,600!

7. Observe what your accountant is doing for you. Is your accountant simply following your orders and producing your accounts, or is he/she proactively working with you to increase your profits by either helping you to increase turnove