You shouldn’t leave your planning to the end of the tax year and getting your financial affairs in order from now can ensure you don’t end up paying more tax than you need to, says leading accounting practice Blick Rothenberg.
The team at Blick Rothenberg has produced the following checklist of tax planning moves.
- Good housekeeping – keep track of your receipts, whether you’re self-employed or running a rental property business, keeping a list of expenditure as you go along through the tax year, rather than trying to find all the receipts after the end of the tax year, will save time and help you keep a closer eye on costs. (Genevieve Moore, partner)
- Likewise, keeping a note of your charitable donations as you go along will ensure that you’re not losing tax relief by forgetting donations that you’ve made when you come to do next year’s tax return. (Genevieve Moore)
- Rather than funding your ISA at the end of the tax year, you may be in a position to fund it at the start of the tax year – sheltering more of your interest received from tax. As some ISA’s are now flexible, you could withdraw the cash from the ISA during the tax year, and then pay it back before the end of the tax year, without the contribution being counted twice towards the annual limit. With all ISA’s you should check which rules apply to yours before acting. (Genevieve Moore)
- Planning ahead – complete your tax return before the end of July and you will know whether you can reduce your 31 July tax payment on account. (Genevieve Moore)
- If making any gifts to children and family, do this sooner! A person can make a gift of £3,000 a year which is exempt from inheritance tax, but for gifts over this amount, the donor has to survive 7 years for the amount to fall out of their estate. (Genevieve Moore)
- If considering selling any assets which are standing at capital gain, best to do this earlier in the tax year as it provides the longest time before the capital gains tax is payable to HMRC. (Nimesh Shah, Partner)
- Review wills for the introduction of the new £100,000 main residence nil rate band which took effect from 6 April 2017. (Nimesh Shah, partner)
- Make any claims for overpaid tax and capital losses relating to 2013/14 tax year now (the deadline is 5 April 2018). (Nimesh Shah)
- Make any pension contributions early (subject to the annual allowance), including stakeholder pension contributions for children – contribute £2,880 and effectively receive £720 free money. (Nimesh Shah)
- If considering making any tax efficient investments (e.g. EIS and Venture Capital Trusts), may be preferable to do this now and can have the flexibility to carry back to the previous tax year where appropriate. (Nimesh Shah)
For more information please contact Genevieve Moore at firstname.lastname@example.org
or Nimesh Shah at email@example.com