Tax Year End Reminders: Use’em or lose’em! Just a few weeks left to check your annual allowances and exemptions. The Tax Year ends in a few weeks’ time on the 5th April. Before that we have the last ever Spring Budget Speech on the 8th March.
UK taxpayers have a number of annual tax allowances that, by definition, must be taken before the end of the tax year. Here are some very important, very valuable, reminders.
You might be astonished when you calculate the value to you of these ‘gift horses’ that you’re looking at (in no priority order):
- Adjusted Income – check your income and assess if you are affected by the tapered annual allowance rules and whether you need to adjust your pension contributions accordingly.
- Pension Contributions Carry Forward – check for any unused pension contribution allowances from previous years before you lose them – any carry forward allowance from the tax year 13/14 will fall away after 5th April.
- Annual and Lifetime Allowances – check where you are up to with your annual contribution limit and your lifetime cap.
- Enterprise Investment Schemes (EIS) – If within your risk profile, IT savings of 30% that can be carried back one year (important to consider if you paid a lot of tax or breached an IT threshold last year). Freedom from CGT after 3 years as well as CGT deferral relief opportunities and IHT relief after 2 years if held on death.
- Venture Capital Trusts (VCTs) – Again, if within your risk profile, IT savings of 30% and freedom from CGT.
- Tax-Efficient Investment in ISAs – up to £15,240 each individual (up to £4,080 each child) in stocks and shares and/or cash.
- Capital Gains Tax Exemptions – up to £11,100 of tax-free gains (the actual proceeds could be much higher).
- Inheritance Tax Exemptions – annual tax-free exemptions on gifts up to £3,000 plus £250 to each individual (but not if the recipient has benefitted from the whole of your £3,000 as well!).
Our advice is to take stock – review your situation. And there we can help! Reviews are part of our added-value services for our clients. Contact us as soon as possible as time is running out.
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Barry Fleming & Partners are an independent financial advisor specialising in ISA’s, Pensions, Tax, Trusts, Estate Planning, Inheritance Tax Planning (IHT) and other Financial Planning areas. Please don’t hesitate to call on 01488 608 686 and ask to talk to one of our financial advisors. Alternatively use the contact form on our home page.