I know I have said this before but investing is not just about performance, it’s also about taxation, and trying to minimise the tax you pay on your investments. In recent years I heard many individuals comment on how unattractive their Cash ISA had become. With the increase in interest rates, it can be more attractive to have your deposit funds in a Cash ISA, as interest in Cash ISAs is tax-free.
Now is the time to do a spring clean on your finances because the end of the tax year is fast approaching and your income levels for the year are much clearer. Sit down and consider these different taxes: Income tax; Capital Gains tax; Savings and Investments; and Inheritance tax – how they will impact you this year, and whether there are any measures you can take for financial improvement.
It is not possible to address all the considerations in the space available here, but they will include trying to utilise your allowances for all of the above. For income tax we all have a personal allowance, are you going to use this in full?
If not, are there ways you can do so?
The personal allowance is also gradually withdrawn for individuals with an adjusted net income above £100,000. If your income is above £100,000, then you may be able to use individual pension contributions before the tax year end to restore all or part of a 2023/24 personal allowance which might otherwise be lost.
Your Capital Gains tax considerations include utilising your Capital Gains exempt allowance and realising any losses. For Inheritance tax, have you utilised your annual exemptions? Do not forget your ISA and Pension allowances that can be utilised prior to the end of the tax year.
I have mentioned some of the end of year tax planning you could consider but there is more. If you would like help with your own situation why not pick up the phone today and request a free without obligation consultation.
The content included on this page is based on our understanding of the UK tax
law at the time of publication. It may be subject to change and may not be applicable to your circumstances.