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Optimum Professional Services are delighted to launch the new monthly conversational series, “Optimum: LIVE!” which will provide the opportunity for you to hear from members of the Optimum team and special guests each month as they delve into a variety of subjects in light-hearted, fire-side chat style productions.
Each episode will be shot or broadcast live (yep! One take!) which means that it is not scripted or edited and has a more natural and engaging tone.
This is a https://www.visual-pr.co.uk production
00:01:54:23 - 00:02:42:25
Chris
Welcome back to Optimum Live episode 21. We're out now. And this is about how much can you earn tax free? Slightly tongue in cheek, but it really is a useful exercise to see how we can be as efficient as possible. I think that's the biggest introduction I can give this. We're all going to be interested. So stay tuned.
00:02:42:27 - 00:02:47:23
Chris
So welcome back to episode 21 of Optimum Live. We've got Mike Laken here.
00:02:47:23 - 00:02:49:04
Mike
Hello, mate. How you doing, Chris?
00:02:49:06 - 00:02:53:15
Chris
Yeah. To be you to be crunching these figures. You do this in your sleep, frankly, don't you?
00:02:53:16 - 00:02:56:14
Mike
Yeah, yeah. That's it. Let's see numbers all the time.
00:02:56:15 - 00:03:03:25
Chris
I think it's summed up by the fact that I've got a load of notes and I said, have you got notes? And you went. No, I went after, you know.
00:03:03:27 - 00:03:05:25
Mike
Yes. It's all up there.
00:03:05:28 - 00:03:23:08
Chris
Yeah. As I then joked and you said, that's why you don't go to dinner parties and. But this I mean, there is a degree of this episode being, you know, slightly tongue in cheek, having a bit of a bit of fun with it. But there is a very serious point to this. It is not how to to fiddle anything.
00:03:23:11 - 00:03:29:01
Chris
It is totally above board, but how we can get ourselves to the most. Is it what say tax efficient way?
00:03:29:02 - 00:03:46:18
Mike
Yeah, it's it's all the little, tax free allowances and everything like that that you could essentially shape your earnings to be. But it obviously is quite complicated, which is a tongue in cheek way of doing that to, to, to maximize all of them. But someone would be sat there looking at going, oh, I don't actually know about that one.
00:03:46:18 - 00:03:53:22
Mike
That's quite interesting. And it might be suddenly they could earn a little bit extra money knowing that they haven't got to pay the tax on it, so it makes it worthwhile.
00:03:53:24 - 00:03:56:21
Chris
So you're basically becoming our Martin Lewis today saying.
00:03:56:23 - 00:03:58:23
Mike
Yeah, if you want to put it that way. Yeah.
00:03:58:23 - 00:04:14:21
Chris
We've had it. And so we don't really. But it is like you say it's complicated. I've had to look through and my head's blown already. But it's about making sure we're there. Okay. Where do we start? I'm going to work through the list that you had in the bullet points. Yeah. List one personal.
00:04:14:21 - 00:04:21:04
Mike
Allowance. Yeah. So this is the one everyone knows about. 12,570 pounds you can earn.
00:04:21:09 - 00:04:22:28
Chris
As of 2025.
00:04:22:28 - 00:04:41:21
Mike
Yeah. This current year, it might change in a budget. You never know. Never. But, yeah, that's that's how much any individual can earn, tax free, high earners that that amount goes down. But we're not talking about those ones at this point. We're just as a as a typical individual, you can earn that amount tax free.
00:04:41:27 - 00:04:52:18
Mike
Okay. And that covers your employment income, pension income, rental income, anything like that. That's 12,570 of any earned income.
00:04:52:20 - 00:04:58:28
Chris
So it's not just because I know we get into, like, salary dividends and all that. It's like it is actually from every.
00:04:58:28 - 00:05:11:10
Mike
So you could have 12,000 of dividends, 12,000 of salary or one of those, or some self-employed income or a mixture of all of it. But 12,000 is tax free together.
00:05:11:11 - 00:05:22:07
Chris
Yeah, right. I got you. Okay. And that is all that that kind of I get the impression when working with you guys is that that's the foundation that that we then work everything else out thereafter.
00:05:22:14 - 00:05:22:23
Mike
Yeah.
00:05:22:23 - 00:05:23:26
Chris
So the most efficient.
00:05:23:27 - 00:05:45:13
Mike
So if you've got, a limited company and you work for that limited company, the, the company itself doesn't have a tax free allowance. So if you don't put a salary through, then you're potentially wasting your tax free earned. And so you could earn 12.5 grand okay. Which is a couple of grand. The tax two and a half grand of tax that you could have saved in the company.
00:05:45:16 - 00:06:01:09
Mike
So that's where like sort of the basis of starts. And it's it also interacts with the likes of National Insurance and stuff like that. Yes. And get your state pension stamps. The salaries. But essentially you could earn 12 grand, 12,570 tax free.
00:06:01:11 - 00:06:21:24
Chris
And so, in other words, is that if I had I don't know. And I know I'm going to use an example that I shouldn't because I know we come onto this in its own right, but let's say I've got a rental property or something like that. That's give me arbitrary figure 6,000 pounds. I would then only 6570 of salary would be tax free.
00:06:21:24 - 00:06:30:09
Chris
Yeah, yeah, yeah. So it's 12 and I've got you. Okay. That's that straightforward next one. And I don't think I've heard of this one. Trading allowance.
00:06:30:09 - 00:06:48:20
Mike
Yeah. So this one we did it on a blog on it a while back when everyone got, it would come out in the news about, HMRC cracking down on all your side hustles. Essentially. Yeah. Okay. So the idea of that it was working out. So these people are selling stuff on maybe Vinted or eBay and stuff like that.
00:06:48:20 - 00:07:10:29
Mike
Right. So essentially if you receive 1,000 pounds a year from these side hustles, whether that could be, cash, like doing a few shifts in a pub, doing a paper room door, you name like something that earned the first thousand pounds would be tax free. Okay, so you can either. So say you receive 2,000 pounds from these side hustles.
00:07:10:29 - 00:07:31:15
Mike
That was taxable side hustles. You could either offset your expenses which could be a bit travel bit of this bit of that okay. Or you can take the first thousand pound off and just treat it as your income. So you ignore all your expenses. You don't claim for any expenses. You have the income that comes in take 1,000 pound off and then the rest is taxable okay.
00:07:31:15 - 00:07:40:22
Mike
So if you you were doing it for this episode, we would go and you could earn 1,000 pound on the nose for no for no tax. And that would be covered by your trading allowance.
00:07:40:24 - 00:07:51:13
Chris
Fine. So now I can get paid a salary. Let's go with easy figures. This after some of it might be I can have a salary of 12,570. Yeah. No tax. I can go.
00:07:51:20 - 00:07:53:17
Mike
Get a paper rounding. Earn 1,000 pounds.
00:07:53:24 - 00:07:57:06
Chris
Yeah, absolutely. That's a good paper.
00:07:57:09 - 00:07:58:18
Mike
Or it's a lot of papers.
00:07:58:20 - 00:08:06:07
Chris
Yeah, exactly. So now we've got 13,570. So that doesn't that doesn't come off of this 12.5.
00:08:06:07 - 00:08:09:04
Mike
No, no it's another one. Yeah.
00:08:09:07 - 00:08:22:28
Chris
Might not be a conversation for this episode, but where on earth is that locked? I mean, if I've gone and you used an example selling some stuff on Vinted or whatever, I mean, I guess the point being is there is a paper like we call it a paper trail or an electronic trail somewhere.
00:08:22:29 - 00:08:32:28
Mike
Everyone's taxes is self assessed. So it's you telling HMRC. So if you earn two grand of of that income, you would need to declare the thousand pounds.
00:08:32:28 - 00:08:49:29
Chris
And I guess the point being is that that's above and beyond. Now it presumably it's not a lot, I don't know, let's say I've got a a roof tent that's 2,000 pounds. I've sold it for 2,000 pound because I'm not using it anymore. That's not a side hustle. Surely I bought that and selling it.
00:08:49:29 - 00:09:05:21
Mike
So but if you were, if you were selling ten a year because you're buying and selling them. Yes. The reason you're doing that is called badges of trade. You would be looking to make income off of that. Whereas if you're selling your own stuff. So that's what people got worried.
00:09:05:21 - 00:09:06:05
Chris
About.
00:09:06:08 - 00:09:08:29
Mike
Because it was it was like they were like the.
00:09:09:01 - 00:09:10:18
Chris
Because that said industry, I think.
00:09:10:18 - 00:09:33:09
Mike
Yeah, parents are selling their kids clothes and stuff because they were still able to see that itself isn't you bought it for more. You sold it for less, you've used it for yourself. You just move in it. That's not taxable incomes. And none of that applies because it's not actually that it's not an income. However, go in and cut in someone's lawn once a week or something like that, and you go and you get paid a tenner for that would all be part of this because your view is to make money.
00:09:33:09 - 00:09:36:28
Chris
Yeah. And making garden ornaments out of empty beer bottles or whatever.
00:09:36:29 - 00:09:37:26
Mike
And selling a double.
00:09:37:27 - 00:09:50:20
Chris
In it, that means you're, you know, you're being creative. What? Okay, I get it, I get it. And my roof box example is that if I found a way I can buy them for 1,000 pounds each, and I'm not selling for 2000, I'm making 1,000 pound a pop.
00:09:50:20 - 00:09:54:09
Mike
Yeah. And your view of the reason for doing it is to make money. Yes.
00:09:54:09 - 00:09:54:24
Chris
I got you.
00:09:54:25 - 00:10:01:00
Mike
Whereas the reason for selling like your kids clothes is to move them on. Exactly. Because they grow outgrown them. You don't need them.
00:10:01:00 - 00:10:01:21
Chris
Got you.
00:10:01:24 - 00:10:13:03
Mike
It's not actually, I'm not, you know, no one's above my wife for her business. She's not buying the clothes. And so. So for a profit, you just buy in and close the kids, and then hopefully there's something worth it at the end because they grow out of them so quick.
00:10:13:10 - 00:10:22:13
Chris
Yeah, better than throwing them away and all of that. That makes sense. Now. I think we're about to get a bit more complicated and detailed property allowance.
00:10:22:18 - 00:10:35:03
Mike
So this one is so there's two to do with property. There's rents room leave, which we'll do next. And then we've got this one which is a property allowance. So you can earn 1,000 pound off of your property tax free. Right.
00:10:35:08 - 00:10:36:13
Chris
That doesn't sound a lot.
00:10:36:15 - 00:10:39:27
Mike
No, but we're not talking. So most people in.
00:10:39:27 - 00:10:40:13
Chris
Here because.
00:10:40:14 - 00:10:58:02
Mike
That's a good idea. And most people will be looking at that going, well, I can't rent my house out for that much. Right. It's not about that. If you it's thinking of a different way, there's. You could rent your parking space on your drive. So if you rent that, I say you rented it for 500 pounds a month.
00:10:58:02 - 00:11:14:15
Mike
Whatever. Like if you're in London, right? Then that would actually be taxable income because there's a source of income. So you could earn 1,000 pounds of rent in, say, a car parking space. Maybe you've got a large garden that you rented out for a Reddit wedding. Yeah, right. It's bits like that. So the thousand pound net could be tax free.
00:11:14:15 - 00:11:19:29
Mike
So that could be, But yeah, renting a parking space is a typical one. Yeah. So that's saying that.
00:11:20:02 - 00:11:21:12
Chris
Okay.
00:11:21:14 - 00:11:28:03
Mike
Maybe you do. On matchday, you live near a football stadium and you do a match and you rent it out for a tenner, £15 every home game.
00:11:28:09 - 00:11:29:02
Chris
Yeah, yeah.
00:11:29:02 - 00:11:34:15
Mike
Technically, that's, that's taxable profit. Unless it's covered by this. 1,000 pound.
00:11:34:17 - 00:11:43:26
Chris
Yeah. If it's within that, then you don't. And you did it. I think there was a note somewhere that said if it's below it, you don't even need to declare it to, you.
00:11:43:27 - 00:12:04:29
Mike
Know, that's it. Because it's it's not it's not a it's covered by that tax free allowance. So it's it's the the aim of some of these allowances is to take people out of self-assessment that don't pay tax, that don't need to be paying tax. So these little ones on the edge because actually it costs the taxpayer more money to have those people declare an essentially nil returns.
00:12:05:03 - 00:12:06:09
Chris
Yeah. And it's not necessary.
00:12:06:09 - 00:12:12:16
Mike
Yeah. So it's it's to take out those and reduce the administrative burden on HMRC and the taxpayer.
00:12:12:18 - 00:12:18:21
Chris
Make sense okay. That's cool. Do we then bring up the rent?
00:12:18:23 - 00:12:39:14
Mike
Yeah. The rent a room kind of goes quite because the two sort of overlap. But they can't they're not allowed to overlap. So you can rent a roommate typically seen as a lodger. You rent a room in your own house that you're living in. So a shared space in your house, and you can earn 7500 pounds a year this tax free.
00:12:39:17 - 00:12:59:04
Mike
So that's quite a bit of money for a lodger. So essentially the idea is to help create space for other people to live. So if they enable it for you to be tax free is incentive for you to take on a larger that might be helping out the housing stock because there's less people pushing for a house or so because they can just rent a room.
00:12:59:10 - 00:13:05:17
Chris
And the probability is if someone's renting out one of their rooms, they're in a situation that is also said, we kind of need to.
00:13:05:21 - 00:13:06:20
Mike
Need to help out, pay the.
00:13:06:20 - 00:13:17:18
Chris
Bills. Yeah. Yeah. So so it really does incentivize them I guess. Yeah, it did because initially my response was hang on. So seven and half grand for renting out a room, but only 1,000 pounds for a property.
00:13:17:20 - 00:13:25:18
Mike
Yeah. But then if you go rent renting the room relief and rent it a drive off the driveway. Yeah you could that's eight and a half but but you I know.
00:13:25:18 - 00:13:37:27
Chris
You used an example of, of a driveway. Another one could be actually garages for people right now, which is that. But because it's called property lands, I assume that that also include if I was just renting out a house.
00:13:38:00 - 00:13:38:09
Mike
Yeah.
00:13:38:09 - 00:13:41:03
Chris
So you get 1,000 pound tax free. Yeah.
00:13:41:03 - 00:13:41:16
Mike
So if I.
00:13:41:16 - 00:13:44:02
Chris
Rent a room I get seven off grand tax free.
00:13:44:02 - 00:14:01:12
Mike
Yes. Because you're not living in the house if you were in the house. So typically if you've got a by two letter you're renting the whole house. You're not living there. Yeah. So you could get 1,000 pound off of that tax free. But typically your expenses are going to be higher. Yeah. So you want to take that approach and work out your profit rather than just taking 1,000 pound off the income coming in.
00:14:01:12 - 00:14:19:22
Mike
And whereas if you're renting your room in your house, you're still living there. Yes. So that's your house. So therefore you get a bigger allowance because it's, creating an extra space essentially for a com accommodation rather than another rental property that could be on the housing market to be bought or sold. I bet a.
00:14:19:22 - 00:14:21:26
Chris
Lot of people overlook that one.
00:14:21:28 - 00:14:31:25
Mike
Yeah. And I think some people, you see it quite often when, couples, divorce and one moves out and someone's left with the house, or.
00:14:31:25 - 00:14:33:15
Chris
Kids grow up and move and.
00:14:33:15 - 00:14:55:01
Mike
Move out, and so they've got a bigger house and maybe can't quite afford to keep all the bills paid for. It's getting a little bit tighter. So actually, if they got a full bed house, they rent one roommate for 600 pounds a month. People do. We're doing it in Malmesbury because like Dyson, students will come up or people will come up and work at Dyson and they've rent a room for the week, go right, or pay for the month.
00:14:55:01 - 00:15:11:09
Mike
But I'm only there Monday night to Thursday night and then to go go back to wherever for the weekend. And they just come out here for work. There's, there's a lots of those situations now, this rent a room doesn't cover if you've got an annex, because that's not part of the house that separates the house. So it's got to go.
00:15:11:11 - 00:15:18:08
Mike
It's got to be it's got to be part of your house, because otherwise you could be say it could be classes like rent in a bit of that.
00:15:18:14 - 00:15:19:00
Chris
Yeah. Yeah.
00:15:19:00 - 00:15:22:01
Mike
So it's got to be part of the house.
00:15:22:04 - 00:15:28:09
Chris
I almost envisage in you next turn around saying, and it doesn't count if they've got an en suite because that's too self-contained.
00:15:28:12 - 00:15:44:16
Mike
No that's okay as long as they haven't got their own separate door. That's not. So if you have say the annexes are literally connected to the house, but they have their own separate door and you can't access it from the other side of the house. Yeah. That's like a you would compare it to like a semi-detached. That's a separate place.
00:15:44:16 - 00:15:45:17
Mike
You couldn't get rent a room.
00:15:45:17 - 00:15:50:20
Chris
But if it was an extension that you built on somewhere along the line and there is that your access.
00:15:50:20 - 00:15:59:28
Mike
And it's communal and it's coming and going and essentially from the existing house to where they are, it's all part of the same house. You can all interlink between, then that's.
00:15:59:28 - 00:16:00:29
Chris
Okay, that's okay.
00:16:01:03 - 00:16:06:18
Mike
But it's when it becomes like a hard wall and it's locked door and it's behind the cabinet or something.
00:16:06:19 - 00:16:09:19
Chris
Presumably they can have a lock on their bedroom door that. Yeah that's.
00:16:09:19 - 00:16:22:25
Mike
Okay. Yeah. As long as like essentially they're using the communal areas, the kitchen, the bathrooms and stuff or like typically the kitchens. So like you come and go together as if they're living like one of your children there. So you see them rarely, but they are there.
00:16:22:27 - 00:16:24:11
Chris
I've been told she's still there.
00:16:24:12 - 00:16:26:07
Mike
Yeah.
00:16:26:10 - 00:16:30:29
Chris
She occasionally shows up with a drum. Fair enough.
00:16:31:01 - 00:16:33:19
Mike
Click that one. Yeah, yeah.
00:16:33:27 - 00:16:41:22
Chris
Get me in trouble. That be done? Yeah. So your phobia is lodgers? Airbnb in the home as well. That. That's it. Yeah.
00:16:41:22 - 00:16:42:05
Mike
That's it.
00:16:42:12 - 00:16:49:09
Chris
So that is. Oh, you get some weird and wonderful house on Airbnb. And it could be that. Yes, it's a house, but you're able to rent a room.
00:16:49:10 - 00:17:03:14
Mike
I done that one. I've done, back in the day when I was more, physical. Oh. Move it. I did the London, the Bournemouth Marathon, and I did an Airbnb and stayed in someone's house. That was a spare room in the house. Just so I could kip and then go to the race one.
00:17:03:14 - 00:17:11:27
Chris
Occasionally I kind of go that route where obviously I'm commentating all over the place, and, instead of a hotel, it's like, just grab an Airbnb and then it's fine.
00:17:12:02 - 00:17:14:14
Mike
You just, you just share the house essentially, so that.
00:17:14:14 - 00:17:17:22
Chris
So they get us off gran tax free. Yeah.
00:17:17:24 - 00:17:28:11
Mike
So it's it's ways where where things get a bit tighter. There's ways of if you want to earn in this extra money that hopefully helps cover the bills.
00:17:28:14 - 00:17:36:16
Chris
Just sort of like checking a couple of the the key points here. It says under the rent a room relief. Is that really what it's called.
00:17:36:16 - 00:17:38:24
Mike
Rent a room rent free release. Yeah.
00:17:38:26 - 00:17:42:17
Chris
You can't deduct expenses if you claim this.
00:17:42:17 - 00:17:58:15
Mike
Yeah. So it is purely done. All these allowances take off the money that comes in. So ignore the expenses. So if someone rented a room from your house and you were living there and they paid you 1,000 pounds, so 12 grand a year, okay, you would take the seven and a half. You could, if you wanted, use the rent room relief.
00:17:58:15 - 00:18:05:23
Mike
You would take the seven and a half grand off of the money. 12 grand coming in. Yeah. Okay. And then you just be taxed on the four and a half grand.
00:18:05:24 - 00:18:09:18
Chris
As in that goes into self-assessment that you've earned. Yeah, yeah.
00:18:09:20 - 00:18:30:00
Mike
Whereas you could if you wanted to take the 12 grand coming in and offset the expenses. But typically in your own house, the expenses are going to be very minimal. Yeah. So you're going to want to go for the, the, the seven and a half. And then you can interlink the thousand pound that we talked about like the, the property allowance for renting a driveway as well as a seven and a half on the same income source.
00:18:30:00 - 00:18:35:19
Mike
If it was separate income sources then yes, that's fine. You can use both of them, but you can't use them on the same income source.
00:18:35:22 - 00:18:40:18
Chris
Okay. Again, this is probably one of those areas that is always worth speaking to you guys.
00:18:40:18 - 00:19:04:29
Mike
Yeah. And it's just like if you. So some people who have a part time job in theory could earn 12 grand on employment income, they could rent a driveway for a thousand, they could rent a room for 625 a month and have that level of income if they do it that way. Yeah, obviously it's takes time to plan it, but it's possible, which is what this is about.
00:19:04:29 - 00:19:07:16
Mike
It's just what things are possible out there.
00:19:07:18 - 00:19:15:06
Chris
Now, an interesting point I see here you can only have one of these to rent a room or the property allowance you can't.
00:19:15:06 - 00:19:31:13
Mike
Have on the same income source. So if it's if you, if you rented the drive to Mr. Smith. Yeah. And you had, Bob, that was rent in your room. That's fine, because that's two different to different income sources, two different allowances.
00:19:31:15 - 00:19:35:18
Chris
Got you. But it couldn't be the same person doing both. Know and have it.
00:19:35:19 - 00:19:37:06
Mike
That's it. For that it's got to be separate.
00:19:37:10 - 00:19:47:11
Chris
Fine, I get that. That makes sense. And you've got to use both reliefs in the same tax year. If they separate income sources.
00:19:47:18 - 00:19:51:03
Mike
Yeah. That's getting into the detail. Yeah. That one.
00:19:51:03 - 00:20:05:03
Chris
No that's fine. Yeah. So. Okay. Rent a room, release them. Enough. Okay. They make sense. I get those now. I thought that was going to be more complicated than it was.
00:20:05:06 - 00:20:28:14
Mike
I said, oh, that's it. All these are aimed at just so things that people might have been doing, and it's just kind of taking some of those out of the tax system because they're actually that they're not generating any benefit for the taxpayer. It's they're actually probably costing money. Okay. So taking these one. Right. But the rent room relief, because that was 5000 a few years back, they put it to seven and a half.
00:20:28:16 - 00:20:38:03
Mike
So the idea is to promote sort of people where they've got a spare room. Okay. So when someone could rent that room rather than trying to take on a whole flat themselves more affordable for.
00:20:38:03 - 00:20:39:21
Chris
That, with help in the housing crisis.
00:20:39:21 - 00:20:54:25
Mike
Yeah, a little bit. It's just a little one and two. Fergal a few, few clients who do that and actually it helps out a bit. They they're able to earn some extra money. And they're on their own. Someone else, their own house. It's okay.
00:20:54:27 - 00:21:06:20
Chris
It a potential erroneous question now. Not for the first time, as I know you're say is. So I'm renting it out for what did you say, 625, 25 pound a month.
00:21:06:22 - 00:21:09:29
Mike
If I've got that right. Well, I trust you.
00:21:10:01 - 00:21:17:06
Chris
Everyone else is doing crunching, but, if they then contribute to bills, I don't know if that's a. Yeah.
00:21:17:09 - 00:21:37:23
Mike
No, it's a good question. I'll let you have that one. I felt the room get lawyers. Yeah. Oh, I've got a question. It's that includes everything. Fine. So all the money that comes in. So. Yeah. You couldn't go that 625 for the room, but £150 for the broadband, £100 for that. It's all part of one payment because if you start trying to offset it, it won't offset it.
00:21:37:23 - 00:21:38:24
Mike
You want to be bringing in the ex.
00:21:38:29 - 00:21:49:02
Chris
I'm assuming out of simplicity you'd want just both sides would want just an all inclusive figure. Anyone. Bill. Yeah. Yeah. Exactly. So okay, that phew. I did ask a good question. Make a note of this. So I think.
00:21:49:02 - 00:21:50:24
Mike
I've. Yeah, yeah I'm sure.
00:21:50:27 - 00:21:51:19
Chris
Yeah, exactly.
00:21:51:19 - 00:21:52:21
Mike
State owned a little.
00:21:52:24 - 00:22:03:13
Chris
I can't be the next one because I think we've done those enough of. Yeah. Dividend allowance. Now this figure 500 pounds seems ridiculously low.
00:22:03:15 - 00:22:05:01
Mike
Yeah. Used to be 5,000 pounds.
00:22:05:01 - 00:22:06:06
Chris
No. Yeah.
00:22:06:09 - 00:22:14:23
Mike
It's been coming down over the years. Yeah. So. Yeah. So it was 5,000 pounds so everyone could earn 5000 hundred dividends tax free.
00:22:14:29 - 00:22:16:01
Chris
Right.
00:22:16:04 - 00:22:36:11
Mike
And then the rate of dividends has been going up and the amount you earn tax free has been going down. So you know, this usual thing same in the next future once it gets more expensive and it starts quicker. So the idea of being with 500 pounds is where people have got these little investments along the way, maybe a couple of Tesco shares, a shell share.
00:22:36:11 - 00:23:00:12
Mike
Once upon a time and empower wasn't like anything like that, where they've just acquired a few shares, maybe from their parents or something like that along the way. And they get £20 here, £30 that nothing major is no. GSK shares of kicking out load of money like just little ones. Yeah essentially those people earning £500 won't have to do a touchstone for that.
00:23:00:15 - 00:23:11:19
Mike
So again taking those really, really small earnings that might pay like more that be £40 a tax on those. If they weren't, it wasn't tax free. The tax system.
00:23:11:21 - 00:23:13:22
Chris
Yeah. Because again it's not worth the effort.
00:23:13:24 - 00:23:25:01
Mike
So obviously they decided the 5,000 pound was a bit too high. They dump that tax in between. So they brought it down over a few years. But it is five in a pound now.
00:23:25:04 - 00:23:33:27
Chris
What controversial question I suspect now, has that been caused by the fact that that was the way that everybody ran off to do their earnings was by dividends rather than.
00:23:33:27 - 00:23:52:18
Mike
So not really, because actually the number of people that do run it through a limited company compared to people who just have small investment shares is probably in like quite a lot lower. There'll be more people with little investment pools, little shares and stuff. So it's it's not that it's just another way of just curbing a few more quid back into the pot.
00:23:52:20 - 00:23:53:23
Chris
Okay. Fair enough.
00:23:53:27 - 00:24:15:04
Mike
I don't think I'm coming up. That will change because I think when you look at what it's trying to do, it's just trying to take those few low earners at the tax taxation system. Yeah. So it won't go down to zero in my view. It would just be it would just stay as it is and it would just cover those sort of ones.
00:24:15:07 - 00:24:17:08
Chris
Removing the admin cost basically. Isn't it.
00:24:17:08 - 00:24:17:29
Mike
Exactly that.
00:24:18:03 - 00:24:24:09
Chris
Okay. So that's but it's still another 500 pound tax free that we can have the next one savings allowance.
00:24:24:09 - 00:24:26:12
Mike
Yeah. So this this.
00:24:26:14 - 00:24:36:13
Chris
Week can I just double check on this and excuse my ignorance because I've got two bullet points here. One called savings allowance and one called starting rate for savings. Are they two different discussions.
00:24:36:15 - 00:25:04:00
Mike
Yes. So if your basic rate taxpayer so your income is below 50,000 pounds you can earn 1,000 pounds of interest tax free. That's five and a pound if you're a higher rate taxpayer. Okay. So but if you're lower now so you have a 12,000 salary, you could actually earn another 5,000 pound of interest tax free, then another thousand pound of interest tax free because you're a better rate taxpayer.
00:25:04:02 - 00:25:19:12
Mike
Yeah. So in theory you could have in this example for just looking at these 12,570 as a salary, 5,000 pound of interest covered by the starting savings rate and then 1,000 pounds for the personal savings allowance.
00:25:19:15 - 00:25:20:12
Chris
Right.
00:25:20:14 - 00:25:23:17
Mike
Getting you to 18,570.
00:25:23:20 - 00:25:27:00
Chris
Where are we find them. That rate of interest, though.
00:25:27:00 - 00:25:30:01
Mike
Well, we don't we don't know how much money we got in the bank account.
00:25:30:06 - 00:25:34:05
Chris
Okay. So if you've got enough to earn that much interest.
00:25:34:07 - 00:25:51:11
Mike
Because tax, because the interest rates have gone up, you could someone could be retired, right? Yeah. With a small pin with a state pension earning about 12,000 pounds. They could have 100,000 pounds of savings they've accumulated over their lifetime. 4 or 5%. That's 5,000 pounds.
00:25:51:13 - 00:25:52:06
Chris
Is that okay?
00:25:52:06 - 00:26:10:20
Mike
So because the interest rates are higher now, if we roll it back to pre-COVID times, interest rates on your savings was a quarter percent, half a percent at best. Right. You've no one was really seeing this level of interest, whereas nowadays actually it can roll up quite quickly. Yeah. So I've just pulled some money out of a mortgage for an extension.
00:26:10:23 - 00:26:21:07
Mike
I've put it into a savings account. And actually you've got to make sure it's in the right part and yeah, and ISIS and stuff, because actually you're earning quite a bit of interest off it. There's relative terms.
00:26:21:09 - 00:26:29:11
Chris
That'll explain why my dad turned to me and said, you guys might be upset. The interest rates are going up for your mortgage, but we're delighted. Yeah.
00:26:29:11 - 00:26:29:25
Mike
That's it.
00:26:30:01 - 00:26:33:24
Chris
So when I said, thanks, dad, I should have it because he's valid. Got a valid.
00:26:33:24 - 00:26:58:22
Mike
Yeah. Because he was earning. He was earning considerably more. Yeah. Okay. And that's it. So so someone who has. So again you think who this would apply to typically is someone who's got to retirement. It's got a state pension or her state pension got some savings because they've been good and they save some money. They can actually earn 18,000 pounds tax free, 18,570 tax free via their savings on their employment.
00:26:58:23 - 00:27:14:28
Mike
Now that's saving that 5,000 pounds saving allowance does decrease if your income goes up. So if you're income go say you got a salary or pension. That go earns you 15,570.
00:27:15:00 - 00:27:17:02
Chris
That's all I have to worry, man.
00:27:17:04 - 00:27:39:27
Mike
That would reduce you by 3,000 pounds. So you would then only earn 2,000 pounds extra on the saving. So as you each pound, you go above 12,570. That 5,000 pound comes down. Oh so that's so typically most people won't get that 5,000 pounds salary. Say they're on a minimum wage or something like that. They would be on 25 grand.
00:27:39:29 - 00:27:47:03
Mike
So you wouldn't get it anyway. So it's looking at those ones with low employment income.
00:27:47:05 - 00:27:48:01
Chris
Okay. Well pension.
00:27:48:01 - 00:27:48:19
Mike
Income.
00:27:48:21 - 00:27:50:19
Chris
Yeah.
00:27:50:21 - 00:27:59:19
Mike
Which dividends this isn't it doesn't get included because that's not earned income usually. Which is good.
00:27:59:25 - 00:28:00:02
Chris
Yeah.
00:28:00:09 - 00:28:02:11
Mike
So you can have your small UK.
00:28:02:12 - 00:28:04:07
Chris
Well you got to remember things like this. Yeah.
00:28:04:10 - 00:28:20:13
Mike
You got your small salary. You could have lots of interest. Then you dividends and you still get that interest as tax free. Okay. So if you've got some money and you've lent it to your company and you're getting interest from your company, it could be a way of getting some of that out that saves tax in the company and earns you income.
00:28:20:13 - 00:28:38:21
Chris
Personally and I'm sorry, we've got a couple more yet to cover, but presumably when you guys are working with us as clients, you are by default looking at all of that and, and are able to to kind of move between the pots what's necessary and things.
00:28:38:24 - 00:28:56:12
Mike
It's why it's why we us here up to we want to have these meetings. Yeah. Because we have the conversations. It's not a direct 20 questions on an email. Have you got money in your bank account? What do you do with this? What about there? What about that? We'll have a conversation and we're gathering information the whole time.
00:28:56:12 - 00:29:13:27
Mike
Yes. And it might be. Oh I see, so I know what I'm trying to find out in the meeting, but it's more, is a better relationship if we're just we're finding that as we go along a little bit, a little bit more casual than going. Right. So how much you got in the bank?
00:29:14:00 - 00:29:14:12
Chris
Yeah.
00:29:14:12 - 00:29:30:18
Mike
Or why? Well, I need to know that, and it just becomes a bit more disjointed. But if we gather at the information, we go, right? Actually, based on that, we could look to do some of this with the savings. We could do this with your earnings. We could use we could do a little bit of that little bit of signing outside.
00:29:30:18 - 00:29:35:27
Mike
How so? Yeah, we could use that, trading allowance. We can work those bits out for you.
00:29:36:03 - 00:29:44:05
Chris
Because that's the whole point is that I know obviously it's called self-assessment, but someone like me, if I was just doing myself, I'd miss off of this.
00:29:44:12 - 00:30:02:21
Mike
And that's what we're here for. We're here to help you. Yeah. Complete your self-assessment. And so we're gathering up those bits of information, for some people, that would literally nothing we can do. So people would go, I want to move on because I want to save you tax. I might not be able to because there might not be anything to do or.
00:30:02:21 - 00:30:10:15
Chris
You might not be able to. Now. And I get the impression that there's times that you can go if you start thinking about this, that will help you in a year or two.
00:30:10:18 - 00:30:30:01
Mike
Yeah. And and we can look to change things. But for some people I looked at some I was taken on a, potential client a couple, a couple of months ago. And I said to I go, there's nothing here that I can do that you're not currently doing yourself. However, I'll give you that peace of mind and the comfort to know that it's right, it's accurate, it's done.
00:30:30:01 - 00:30:43:05
Mike
We've got the deadlines. You don't need to worry about that. We'll just gather it for you. I said so at that point because you've done a really good job of his figures. I was I'm just going to give you peace of mind and comfort that it's all good. And you can call me at any point that you need.
00:30:43:05 - 00:30:56:16
Mike
Got a problem? Or we've got a question. Rather than having to just sit on the internet trying to find it yourself. So for some people, I'm not going to be able to save and tax. No. But for and for those is just a comfort. And for other people.
00:30:56:16 - 00:30:58:08
Chris
I'd rather know that we.
00:30:58:10 - 00:31:17:13
Mike
Good. Yeah. That's it I meant so I was chatting to somebody yesterday and he goes I've been doing attached to him for years but I don't know if it's right or not. And I was like, but actually he's mentioned that to me a few times. So it's obviously on his mind that it might not be right. So if I go, no, yeah, it's all good done, then it won't be on his mind that it's not right.
00:31:17:14 - 00:31:19:02
Mike
And so then he can focus on the rest.
00:31:19:02 - 00:31:42:29
Chris
Of it, as I always remember, Richard Matthews obviously, who was also the founder of. Yeah, yeah, yeah. Enjoying his retirement these days. And he used to say, you know, don't chase the dragon. This is the, this tax to pay. Enjoy that. You're doing well. There's this tax to pay. Yes. It's about being efficient for sure, but it's not about eliminating it.
00:31:42:29 - 00:31:45:09
Chris
For goodness sake. You don't chase that dragon.
00:31:45:09 - 00:31:59:04
Mike
That's it. It's the same insight with, with people come and say, oh, I don't want to pay. I won't pay tax in the company. So if you want to be able to earn money to pay the mortgage in bits so that that you take out it's dividends that's coming from post-tax money in the company. We talked about it before.
00:31:59:10 - 00:32:05:13
Mike
So you're going to pay a corporation tax bill there. So there's going to be tax to pay if you want to be able to live and pay the bills and pay the mortgage.
00:32:05:13 - 00:32:12:09
Chris
And we can grumble about it as much as we like, it isn't going anywhere. What do they say? The things you can guarantee is death and tax. Yeah.
00:32:12:09 - 00:32:12:20
Mike
That's it.
00:32:12:21 - 00:32:25:26
Chris
Yeah. And it is what it is. But, you know, this is a useful exercise to see that. Hey, there might be some other bits and pieces. I think we've got, one more in your equation that you did capital gains tax allowance.
00:32:25:26 - 00:32:47:27
Mike
Yeah. So, if you buy some shares in Apple for a tenner, sell them for £20, the gain, the profit becomes part of your capital gains tax. Yeah. So you can earn now. Used to be loads more. So when I had done this a few years back you could the total of this came to nearly 50 grand, with all the different allowances that have come down over the years.
00:32:47:27 - 00:33:08:29
Mike
Whereas now you can only get 3,000 pounds. So, yeah, the total amount. So, typically financial advisers, if they got a pot of investments, they'll be doing some little selling and stuff during the year to make sure that they created your pot, an extra 3,000 pounds of, of tax, like the money that's you don't pay any more tax on.
00:33:09:01 - 00:33:28:01
Mike
Yeah. So they do that. I see it quite often in their, in their tax reports and stuff. They've done some selling crystallized by some money and away they go. So there's, there's that that you could earn. So if you, you could buy some shares, sell them before the end of the tax year, put 3,000 pound of profit in your pocket and not pay any tax, and.
00:33:28:01 - 00:33:29:16
Chris
Then leave the rest of the line.
00:33:29:19 - 00:33:32:28
Mike
And then and then reinvest again next year and go again.
00:33:33:00 - 00:33:40:21
Chris
Okay. Yeah, that makes sense. So that's another three. I'll go ask a question. Then you get nervous that I'm asking so much.
00:33:40:21 - 00:33:41:27
Mike
Yeah, I get one.
00:33:41:27 - 00:33:44:15
Chris
Right. And that's no no stopping me is a
00:33:44:18 - 00:33:47:07
Mike
It's just how quick the how bright the room.
00:33:47:10 - 00:33:54:09
Chris
Amazing. I'm going to go with your example by Apple shares for 10 pounds other, which.
00:33:54:09 - 00:33:55:20
Mike
I think is up for you as a bargain.
00:33:55:20 - 00:34:06:19
Chris
And you probably of other companies and fruit are available but buy it for 10 pound, sell it for 5 pounds. They don't do it the other way. That suddenly adds to my allowance because I've lost their way.
00:34:06:23 - 00:34:24:11
Mike
But that loss will carry forward to next year. So yes, in theory it will. So if you've got a load of losses one year personally. So like personal capital gains losses, as long as you sell them and crystallize what they say, crystallize that loss. Yeah that will be use you use it. It gets used first before your allowance is next year.
00:34:24:11 - 00:34:35:15
Chris
So if I lose, again, just for simplicity, I've lost 1,000 pounds on the shares. But I need to get out because it was going to go worse. Yeah. I've now got 4,000 pound allowance next year.
00:34:35:18 - 00:34:53:03
Mike
Yes, yes. Essentially, yes. That's exactly right. So again, that's something that actually does regularly get missed off. Is that people won't tell us that because to record that loss, we've got to put it on the tax ten. So if you don't sell it we don't put it on. So everyone and again I'll give you that's two for two.
00:34:53:03 - 00:34:55:18
Chris
I'm doing well.
00:34:55:20 - 00:35:11:11
Mike
That's a really good point because people remember to give us information that it's got, they got to pay tax on. But forget these other ones. So again, a client at the moment, he's got a couple of gains, but he's also got a no losses that he's done and he's crystallizing some on some shares and stuff to make sure that he can use up.
00:35:11:12 - 00:35:13:21
Mike
Yeah. Because he knows that he's lost money on them.
00:35:13:24 - 00:35:26:09
Chris
And I know that some people might go, well what why are you selling them if you're losing? It's like, because if you know that there's about to be a run on this company or something to that effect or you seeing it and you're like, quick, get out now so I can, you know, minimize my lower.
00:35:26:09 - 00:35:34:06
Mike
If it's at the bottom and there's no way it's going up. Yeah. And you've got a taxable gain, you could lose it to save the tax.
00:35:34:08 - 00:35:34:20
Chris
Got you.
00:35:34:22 - 00:35:42:02
Mike
Because otherwise if you pay the tax on the gain now and you sell the ones for a loss in three years time, I can't put that loss back here.
00:35:42:06 - 00:35:43:05
Chris
No, no no.
00:35:43:05 - 00:35:52:18
Mike
So it's one of those. So again it's, it's just being being aware and being clever and looking forward rather and just seeing what you can offset.
00:35:52:24 - 00:36:03:02
Chris
It's creative in it. That's the reality. So if we add all of those ones that you've put figures on, that now adds up to a total of 31,570. Yeah, tax free.
00:36:03:03 - 00:36:12:09
Mike
Tax free digital. Now we haven't talked about that like so you could have an uncapped amount of interest on ISIS.
00:36:12:11 - 00:36:14:01
Chris
So as uncapped interest on on.
00:36:14:01 - 00:36:36:28
Mike
Yeah. So if you had 1 million pound in your ISIS that you've been building up over years or something like that, it's possible. But. Right, but it's right that interest is all tax free because it's in an Isa and we haven't. And there's also ways of earning money from if shares and VCT shares, which goes off in a massive tangent, which isn't that get serious revenue.
00:36:36:29 - 00:36:58:06
Mike
So fine. Yeah it's on in check approach. But so if you have any money in ISIS. So I always panic, when I'm talking to a client, when I'm finishing off their tax term because I know clients have got some money in savings, so might I haven't got on the taxman and I go to, go confirm into them that that money is in an Isa and most clients have got their money set in an Isa.
00:36:58:06 - 00:37:22:28
Mike
So. But years ago, when I was first starting out into accounts and stuff, the interest rate was so low that I didn't see the point at the time of an Isa because it was tax free anyway, because you weren't earning very much, or as because whether it was in a normal savings account. But by adding each year to the ice and now the interest rate has gone up ten years ago, if you put in your 20 grand a year, you've got to undergrounds at 4%.
00:37:22:28 - 00:37:37:05
Mike
That's eight grand a year this tax free. Whereas over here, if you left it in a normal savings account, you'd have 8,000 pounds taxable at 20 or 40%. That could be three grand a year every year. So then you go, oh actually I wish that. But then and.
00:37:37:05 - 00:37:40:22
Chris
So you can't suddenly move all of that over because a certain amount of yeah.
00:37:40:22 - 00:37:51:21
Mike
Yeah. That's it. So that's why your financial advisers will tell you to put money in, I says, because when the rates start going up compounds on itself and it's very, very nice and it's tax free.
00:37:51:24 - 00:37:52:29
Chris
Now I'm wishing I'd done that.
00:37:53:02 - 00:37:56:19
Mike
Yeah. But you need, we need we all need the money lying around.
00:37:56:21 - 00:37:58:03
Chris
That that's the my big problem.
00:37:58:07 - 00:38:14:11
Mike
So yeah, it's I mean that's the thing to be aware of as well. It's just people might not realize that that that's the effect of what it can do. One year you might look at it and go, well actually the interest off of that put in ten grand in my eyes is covered by these savings allowances. So why does it matter?
00:38:14:13 - 00:38:20:20
Mike
But if you keep adding to it and the balance grows, some point, you're paying tax when you could have not pay tax.
00:38:20:22 - 00:38:28:05
Chris
Why is that uncapped tax free? Why? Why have they put that one.
00:38:28:07 - 00:38:28:26
Mike
Although I say it.
00:38:28:26 - 00:38:30:14
Chris
But it's very interesting.
00:38:30:17 - 00:38:50:14
Mike
I suppose again it's promoting people another way of saving some money. That's, that's, that's aside. So I suppose you, the government want people to have savings because they won't need they got some. They've got their own war chest of things. If things go wrong with in later life, they need care. They've got some money.
00:38:50:14 - 00:38:57:11
Chris
And presumably that cash. I don't know, maybe I'm being cynical is that they've actually got use of cash that's out there.
00:38:57:18 - 00:39:12:12
Mike
Well, the banks are all using it because these ones aren't. You can put you in the NSC and stuff like that, which would then be government based ones. But, the banks are using it, but it's more I think it's more just allowing people to build up some funds. Yeah.
00:39:12:12 - 00:39:16:09
Chris
Okay. Premium bond winnings as well. Yeah.
00:39:16:11 - 00:39:24:03
Mike
It's gambling. Well, it's because there's a form of gambling. It's to governance. Tax free. That's why when you see, like your National Lottery going, people.
00:39:24:03 - 00:39:32:17
Chris
Still do it. I mean, that's what gambling. No. Yeah. No, no they do that. Crikey. But no premium bonds I mean for me in my head that's like an old thing.
00:39:32:20 - 00:39:37:10
Mike
So people did them a lot around Covid time.
00:39:37:13 - 00:39:38:13
Chris
Okay.
00:39:38:15 - 00:39:57:27
Mike
Because the interest rates were low and people were coming into some money. Yes. So they actually they put him in there because the interest rate was low. Now the interest rate is higher. I think the the appeal for a premium bond is lower because if you add up all your winnings, I think it's less now. It would be less than the interest rate.
00:39:57:29 - 00:40:17:24
Mike
So people but then there's always that chance of that big one. Yeah yeah yeah yeah I don't know gets it. But so but then if you do earn this tax free because this is the same as gambling okay. So the same as saying you could earn a whole load of money if you gamble, tax free, but you just can't offset all the money you've lost in the meantime as well at the same time, which is why they do it.
00:40:17:26 - 00:40:24:22
Mike
Because let's face it, the house wins. So you're going to lose out. So if they tax your winnings, they'd have to allow you the losses.
00:40:24:25 - 00:40:36:25
Chris
And I'll keep buying those lottery tickets from this fund and everyone else on that. And I think that was where we wanted to wrap this one up. We weren't going down, you know, state related stuff and all that.
00:40:36:25 - 00:41:02:07
Mike
No. That's it. So one thing I've put on the way up this morning, I was thinking about. So people look at, their personal allowance, they know that's your tax free. Then they start getting their pension money and say they got their state pension and they still there, still earn in from their company or from wherever, whatever role that doing people's thing that the state pension is tax free because you paid into it is the pot.
00:41:02:10 - 00:41:29:27
Mike
An important bit I would say for this is just because I had the thought this morning is that state pension is still taxable earnings for most people, like historically, if they got to their pension age that was their own. Yeah. And and so it was tax free because it was covered by the personal allowance. But where people have got second pensions, private pensions that they're drawing on or they're still working because people that do still work nowadays whilst getting their state pension, it all adds up together.
00:41:29:27 - 00:41:43:02
Mike
So it does become taxable. Okay. It might not be directly taxable, but the other source so you got from your, your company would then be taxed at 20% because your, your state pension largely absorbed up your personal.
00:41:43:02 - 00:41:55:19
Chris
Allowance, got you in essence. So there's probably a lot more than we realize, that that can be, leaving more in our pocket.
00:41:55:22 - 00:41:56:08
Mike
Yeah.
00:41:56:11 - 00:42:01:27
Chris
You know, that's the reality of it completely different ways, as in all of them together is a very hard jigsaw puzzle.
00:42:02:04 - 00:42:03:17
Mike
Exactly, to say.
00:42:03:17 - 00:42:05:15
Chris
The least. But there are some. There is.
00:42:05:15 - 00:42:12:01
Mike
At some point you needed to earn the money to put the money in the savings. You need to pay the corporation tax to enable a dividend allowance.
00:42:12:03 - 00:42:32:07
Chris
It got complicated, but, you know, it's about being aware. It kind of emphasizes the point. Again, that's where you guys, as experts, are better than me trying to do self-assessment and making sure I've got everything and that I've got everything accurate. But I, you know, it's always about, because that picture changes every year. For an individual anyway, doesn't it.
00:42:32:07 - 00:42:42:21
Chris
Yeah. So let alone the government changing things, you know, regularly as well that that means that you got to keep an eye on it, but it shows there is more possibility out there.
00:42:42:24 - 00:42:43:18
Mike
Yeah.
00:42:43:21 - 00:43:03:12
Chris
I think that sums it up brilliantly. I don't have as much of a headache as I thought I was going to go for this one. I'm quite relieved. And it does show that our next episode, as it stands, our next episode leads on quite nicely from this, I think, because and this is quite another tongue in cheek title we've gone for of what does your accountant actually do for you?
00:43:03:14 - 00:43:21:12
Chris
And I like that one because I've learned an awful that it's an awful lot more than than you think. And your priorities might be different, but it's kind of almost already slightly demonstrated with today's episode why that's going to be a good topic for us to cover.
00:43:21:17 - 00:43:31:15
Mike
Absolutely. Yeah. My answer some questions that some people look for, and it might give others reassurance that we're doing more than perhaps they thought we were doing. Yeah. Just this just being checked in the background.
00:43:31:18 - 00:43:52:29
Chris
Exactly. Now I love it. Well, I look forward to that then. That'll be episode 22. But for episode 21, I hope it's been useful for you. I hope you don't have a headache that, if in doubt, because I know some of it. You'll go, so do I. Don't I get in touch, you know. Oh. Co.Uk, all of the contact details are on there as well.
00:43:52:29 - 00:43:58:14
Chris
Get in touch. For any questions over that you might have. And the team will be delighted to answer them.
00:43:58:15 - 00:43:59:01
Mike
Absolutely.
00:43:59:05 - 00:48:04:00
Chris
Fabulous. Well, thank you for joining us. I hope it was useful. And we'll see you next time. Cheers.
00:48:04:03 - 00:48:10:28
Chris
Smile for the camera. Claire, I was right.
00:48:11:01 - 00:48:19:09
Mike
So good. Bad as you pay your kid who's nowhere and who's at the point what can earn. And then you charge and rent for living in your house tax haven.
00:48:19:09 - 00:48:21:27
Chris
Oh, I no, you see where you get the camera was up on that for that one.
00:48:22:02 - 00:48:24:20
Mike
Yeah. And then get your money back.
00:48:24:22 - 00:48:25:21
Chris
That's that.