With less than a week until the end of the tax year, have you made the most of your allowances? Invest a little time over the next week and the rewards will last a year.
1 – Maximise your ISA Allowance
The coming week is your last chance to use your 16/17 ISA allowance with no way to roll it over. The limit for this year is £15,240 in cash, shares or investments. It is worth saving as much as possible with this years allowance, to maximise your 17/18 allowance.
2 – Maximise your Pension Allowance
The end of the tax year is the final chance to make use of various allowances and that includes your annual pension allowance. The final week of the tax year is a busy time to top up self invested pensions in addition to ISA contributions. Recent years have meant a reduction in the annual allowance for pensions, currently standing at £40,000 with lower levels for higher earners and those having accessed pension freedoms. Depending on your tax bracket, tax relief of between 20 and 40 percent can give your pension a significant uplift.
3 – Capital Gains Allowance
The current allowance stands at £11,000 per person and has to be used in the current tax year, without being able to roll into the next tax year. Use it or loose it…
4 – Spread the wealth
Your spouse and children have their own individual ISA allowances. The junior allowance is currently £4,080 this tax year. Many grandparents and parents set up premium bonds, ISAs or cash savings accounts around this time of year. Maximise your allowances between family members.
5 – Regulate your cash
Basic and higher rate taxpayers enjoy the personal savings allowance under which savings interest maybe accrued tax free.
6 – Pay down debt
With interest rates currently low, it may seem a good time to load up on credit card debt or take out an interest only mortgage (where still available). But many economists expect a sharp turn in the Bank Of England policy on the horizon, quickly catching out debt laden consumers and piling on interest charges.
7 – Speak to an adviser
To ensure that you are making the most of your allowances, speak to an independent financial adviser or accountant. Ascentant in Derby are able to offer tax planning and financial advice on pensions, ISAs and general accountancy advice.
Ascentant Limited, Laurie House, Colyear Street, Derby, DE1 1LA | 01332 897356 | firstname.lastname@example.org