The current tax year, 2019/20 is coming to an end on 5th April 2020. You’d be forgiven for being distracted during the current pandemic but it is important to ensure sight is not lost on important tax reliefs which can’t be carried forward.
This blog covers basic tax planning tips.
There is a maximum £20,000 maximum annual allowance per annum which can be spread across multiple types of ISAs. There’s no carrying forward possible with this allowance so be sure to take advantage of the full amount available before the end of the tax year.
The annual allowance for pension contributions is £40,000 or 100% of your income, whichever is lower. With the introduction of the tapered annual allowance, many high earners find themselves faced with a reduced allowance of as little as £10,000. You can rollover any unused portion from year to year (up to three years prior as long as you had a pension plan in place.) Speak to an IFA or ask us and we can recommend you.
It continues to surprise us how many higher rate taxpayers do not claim for additional tax relief on their charitable donations to registered charities. Under the Gift Aid scheme charities can claim back the basic rate tax you’ve paid on the money donated. For higher rate taxpayers you can claim additional relief through your tax return or by contacting HMRC.
Consider using your tax free CGT allowance
Profits on investments of £12,000 will be tax free up for the year ended 5th April 2020. The tax free allowance can not be carried forward so it may be worth considering whether or not you should sell a portion of any assets that have appreciated in value.
There may other reliefs applicable to your circumstances. Seek professional advice to find out more.
None of the above is advice. Each individual should seek independent advice before making important decisions.