Many of us buy assets throughout a financial year. An asset is anything that adds substantial value to our lives. When we purchase a vehicle or a home, the most important thing that happens is the creation of an asset in our lives. Your assets are a part of your valuation. In order to purchase any asset you need to shell out a lot of money. While you are purchasing any form an asset you will have to pay some taxes which comes along with it, for example if you are purchasing a house, you will have to pay property tax.
There are many different kinds of payments which are attached to the purchase of any fixed asset. But the Government wants to encourage individuals to purchase their own assets. As a form of encouragement, they have introduced the form of credit.
What Is Credit?
These credits can be taken and in most cases you will either have to pay them back without any interest or not repay it back at all. How does this help? The main thing is that when you are planning to purchase something big, you often take a loan or some form of receipt in order to pay it back. Now imagine if you are taking it from a bank. You will charged a large amount of interest. But these tax creditsdo not require you to pay any interest at all. By availing these tax credits you are not only saving on a lot of interest but also having tax savings as well.
Home Buyers Tax Credit
When you are a first time home buyer you can avail a lot of tax credit on the home that you are wanting to buy. A first time home owner is a person who has not purchased any home in their name prior to this time. They can then avail the first time home buyer tax credit. This tax credit enables them to take a credit of the amount that they can avail. By using this credit the home buyer can use it to save tax and make interest free payments as well. This is a very good thing for anyone who wants to purchase a new home. Purchasing something like a home can itself be a very big investment. So by saving on your tax you can easily feel a bit lighter.
Tax is one of those responsibilities that all of us need to take up irrespective of whether we want to or not. So in order to save yourself some tax you should make sure that you do some research before filling the forms. If you can fall in the categories that lets you to avail such buyer tax credit then you should definitely opt for it. This will help you to save in that year’s tax and in some of the consecutive years as well. It is always recommended that you talk to the professionals at HMRC helpline in order to get the best ideas on how to save on tax.