Year End Meeting and Tax Opportunities
Before you know it it will be 5th April and the tax year end will be here. With just under two months left to go, now is a great time to sit down with your accountant to review your financial and tax affairs.
It’s always a good practice to be prepared and ensure that any pre-year end actions to save tax are discussed and agreed. A pre-year end meeting can also help you to know where you stand with tax, profits, drawings and cash flow whilst you can still do something to change the situation in your favour.
The timing of certain transactions, such as profit extraction or capital purchases, can help to minimise liabiities and its very important to make sure those transactions are completed at the right time.
There are plenty of options available to you to minimise your tax liabilities which can all be discussed at your meeting. Below is summary of the common year-end tax planning ideas to get you thinking:
- PENSIONS: Pension contributions can provide for your future and reduce your personal or company tax liabilities.
For example, Did you know that any unused annual allowances from the previous three tax years can be carried forward and used this year, accelerating contributions before the end of the tax year.
- TAX FRIENDLY INVESTMENTS: Certain types of investment, such as EIS, SEIS and VCT, offer very generous tax breaks. Tax payers can obtain tax relief on up to 50% of their investment, plus many more benefits such as tax free disposals and capital gains deferral. The tax relief can also be carried back to the previous tax year.
- ISA: Investors who have not used up their full ISA allowance should consider making a contribution before the end of the year. The current ISA allowance is £20,000. There is no carry forward mechanism for the “use it or lose it” allowance. Income and gains arising in an ISA are tax free.
- TAX FREE ALLOWANCES: This year the tax free personal allowance is £11,850, the Capital Gains annual allowance is £11,700 and the tax free dividend allowance is £2,000. Ensure that you and your family members have made the most of all the available allowances. Haines Watts has recently released a new Tax App – to download your copy click here.
- CHARTITABLE DONATIONS: Feeling charitable? Make a charitable donation and pay less tax at the higher rate.
Haines Watts East Anglia offers a Tax health check in order to ensure that any business or personal financial affairs are as tax efficient as possible, identify opportunities and help to minimise any liabilities. Check out our Year End Tax Planning Guide here.
Would you like a review for both your personal and business tax? Get in touch with us now to organise a meeting at your convenience.
Our office is located on the Diss Business Park. Drop in and see us or give us a call on 01379 640555.