• The new top income tax rate of 50% applies to individuals with income over £150,000 from 6 April 2010.
• Dividend income received by top earners will be taxed at 42.5%.
• From 6 April 2010, the single person's allowance will be subject to an income limit of £100,000.  Where an indidivudal's adjusted net income exceeds the limit, the allowance will be reduced by £1 for every £2 over the limit.
• From 6 April 2011 tax relief on pension contributions, including those from employers, for individuals with incomes of £150,000 or more a year will be reduced.  Relief will be tapered down so that it is 20% once income reaches £180,000 a year.  To stop people avoiding this change before 6 April 2011, the Chancellor also announced interim 'anti-forestalling'  provisions which are valid from 22 April 2009 until 5 April 2011 to individuals:  whose income is £150,000 or more in the current or either of the two proceeding tax years;  who change their 'normal ongoing regular pension savings';  whose total pension savings following any change exceed £20,000 a year.
• An additional special allowance (set at £20,000) and associated tax change have been introduced which is in addition to the normal annual allowance charge that was introduced from 6 April 2006 (£245,000 for 2009/10).   If an individual's non-regular pension savings in a tax year exceed the special annual allowance, then the  individual will have to pay an associated tax charge on the excess of the difference between the top rate of tax and the basic rate (20% for 2009/10).  The tax change, therefore, has the effect of restricting tax relief on additional pension savings to the basic rate of tax and will be collected through the self-assessment tax return.  Where both the normal annual allowance and the special annual allowance are exceeded, the amount subject to the special allowance charge is reduced by the normal annual allowance excess.  From 2010/11, when the 50% top income tax rate takes effect, indications are that this special allowance charge may increase to 30%.

How to minimise the impact of the tax changes in 2010

• Use up all your tax allowances, i.e. your ISA allowance of £10,200 (£7,200 for those under 50 in 2009/10), as well tax-free National Savings & Investments products.  Transfer income-producing investments, such as shares, let property, bank deposits to your spouse/partner, if s/he is not working or pays a lower rate of tax.  This now applies not only to a spouse/partner paying basic rate tax, but also to those paying 40% income tax if the other spouse/partner earns above £150,000.
• Transferring income to your spouse/partner can also be useful if s/he is a partner in your business or a shareholder/employee of your company.  HMRC has indicated an intention to challenge such arrangements, so the arrangements need to be justifiable and set up and documented correctly. 
• Investment funds that accumulate income might be attractive because with careful planning it may be possible for you to defer the tax liability on that income into a year when the relevant tax rate is lower.
• Insurance bonds, including offshore, could be an option as you are permitted to use 5% a year of your original capital for 20 years without a tax charge.  When the bond is cashed, returns are treated as income at your highest tax rate, but if you expect your income to reduce below £150,000 in the future, perhaps when you retire or pay no tax at all if you have become an expat or a non-domiciled individual, the bond could be cashed at that time.
• If your bank account pays interest in an annual lump sum which is due to be paid after April 2010 and will mean that your income will be above £150,000, it makes sense to close the account now and have the interest paid in the current tax year at a lower rate of income tax.  You can then subsequently open a new one.
• Donations made via the Gift Aid Scheme after 6 April 2010 will attract higher tax relief for higher earners, resulting in more money for the charity, but beware of the possible impact on the charity if you withold regular payments.
• Ask your employer to pay your salary early, to avoid higher tax.  You can also exercise any share options you hold before 6 April 2010.  These attract income tax so you will pay the lower rate.  Those already taking pension income can opt to receive their annual payouts in a lump sum before arpil 2010.  The share option scheme may result in the gain being subject to Capital Gains Tax at 18% instead of Income Tax of up to 50%.
• Put more into your pension in 2010/11, before the tax relief is restricted in 2011.
• Move your investments from income to capital growth.  Since Capital Gains Tax was lowered to 18% in 2008, investors have been seeking returns that are taxed as capital gains rather than income.  However, there is a strong possibility that the Capital Gains Tax rate may increase in the future.
• If you are a trustee of a discretionary or accumulation trust you need to review your trust to ensure that your beneficiaries can reclaim the tax paid by the trust.  With effect from 6 april 2010 trustees will be liable for Income Tax on all their income at the rate of 50%.  You may wish to consider before 6 April 2010 restructuring or allocating distributions or focussing on non-income producing assets which will defer higher rate tax assessment.
• If you are a non-domiciled individual you should consider making taxable remittances prior to 6 April 2010 to reduce your exposure.
• You could consider using an Employer-Financed Retirement Benefits Scheme (EFRBS) which is fundamentally an 'unregistered' pension scheme.  It can provide a specialist solution to the new 50% tax rate and new pension capping rules.  EFRBS can be particularly attractive if you are a non-domicilled individual seeking to mitigate the impact of the £30,000 remittance basis charge and/or considering retiring abroad.