Are you ready for the end of the tax year?

Saturday is the 1st March so we only have 5 weeks to ensure we are making the most of your tax allowances for this financial year. 

If you haven’t already contacted your IFA and discussed your options for this tax year, now is the time to do it. 

 

Here is a checklist to make sure you are making the most of the annual tax allowances. 

• Remember to top up your ISA, the allowance is currently £20,000 per annum. There have been reports recently that The Labour Government may cap cash ISAs to £4000. If you go back in history to the launch of the ISAs in 1999, the annual allowance for a stocks and shares ISA was £7000 and £3000 for a cash ISA. This then changed in 2014, where you could then split your ISA into ways that better suited you. 

• Give your children or grandchildren a helping hand, this is something I did when all my children were born. Take out a Junior ISA, you can pay up to £9000 a year (in addition to your own ISA allowance) into a Junior ISA until the child is 18, this comes with a slight health warning. Once the child reaches 18, you are then advised you no longer have any access to the account, and it passes to your child. 

• A further legacy option for your children or grandchildren, is to take out a Junior SIPP (a self-investment personal pension) You can invest up to £2880 per year, which is grossed up to £3600 due to tax relief added. The fund then grows in a tax-efficient structure but cannot be accessed for capital or income until age 55. 

• You can top up your pension. The annual pension allowance is a generous £60,000 per tax year (high earners may be subject to a taper) or 100% of relevant UK earnings, whichever is the lesser amount. 

• Claim tax relief on any charitable donations. 

• Review your state pension contributions. From this April 2025, the window is closing for making up any shortfall years going back to 2006. After this, you can only go back 6 years. Worth checking now if you have shortfall in earlier years. 

• If estate planning, you can start to give away £3000 annually (your annual exemption) without this being subject to inheritance tax, should you die. 

• If you run a Ltd Company, you can look to reduce your corporation tax bill by making a company contribution to your pension. 

 

Don’t let another tax year pass without making the best of your available allowances! 

 

Questions? Drop me a message.