Increases in income tax, capital gains tax and inheritance tax represent both problems and opportunities attendees at financial seminars in Dubai and Abu Dhabi held by Dubai-based independent financial advisory firm Hoxton Wealth have been told.

Jonathan Brookes, Chartered Financial Planner and Partner at Hoxton Wealth, set out how the fiscal drag around rising income tax was bringing more taxpayers into higher rate and additional rate tax brackets, and how taxation-targeted residency and source-based income means money saved now will be taxed in the future. 

In total, nearly 500 people signed up for the seminars and Brookes spoke to attendees about the importance of carefully monitoring residence status using statutory residence tests, using all allowances available, including both personal allowances for couples, keeping income producing assets offshore, and taking “income” from non-taxable sources when in the UK.

In terms of capital gains tax moving to 24% and the possibility that it could rise further to match income tax, attendees were shown the importance of seeking to realise gains before returning to the UK, to hold assets that grow and never have taxable gain, and to use FIG (Financial Institutions Group) rules where available.

Brookes also spoke about rising Inheritance Tax with the Nil Rate Band (Tax free allowance) being frozen to 2030. This 21-year gap, he reminded attendees, represented a freeze for an entire generation.

“At only £325,000, it is a tax which automatically assumes you are a high-rate taxpayer of 40%,” he told attendees. “In addition, with pensions to be included and Gift With Reservation Rules strengthened, means you lose control on gifting.”

On potential counters to these measures, there was discussion on the use of long-term residency, using gifts and all allowances, holding assets offshore, and using the Double Taxation Agreement to move pensions from taxable to non-taxable trusts.

Attendees were also introduced to the concept of Wealth Flow Planning, using tools like the Hoxton Wealth app to help stay on track when things are bad.

“Wealth flow forecasting is an exercise that helps map out your life events and goals onto a visual timeline,” he explained. “This allows us to understand how likely you are to hit your goals and simulate different scenarios to discover the best path moving forward This exercise is particularly important for helping you to understand whether you are in-line to meet your goals or not. If you want to drawdown X amount in retirement or need Y to pay your children's university fees, will you have enough?”

Wealth flow planning, he added, also helps you understand and model your current position whilst considering changes or enhancements to how you currently hold your assets. It lets you visualize and quantify the likely end positions.

“Tax planning and mitigating paying any unnecessary tax is a sure way to turbo charge your portfolio’s returns. Not planning for tax can make a dramatic difference in the amounts you have to draw down and ultimately leave to your family. Using wealth flow modelling and financial planning can help quantify this,” he concluded.

In his presentation, Brookes also pointed to Vanguard research showing that taking advice can add approximately 3% annually to clients' net returns through professional management. This added value comes from behavioral coaching, tax-efficient strategies, portfolio rebalancing, and cost-effective investment selection.