Right-Wealth-Management-2023
Search
Close this search box.
Search
Close this search box.

Maximising Your Financial Opportunities for the Upcoming Tax Year End

Maximising Your Financial Opportunities for the Upcoming Tax Year End_Right-Wealth-Management-2024

Share

As the end of the financial tax year approaches on 5 April 2024, individuals and businesses alike are looking for strategies to maximise their financial opportunities and minimise liabilities. The period leading up to this offers a great opportunity to assess your financial health and make adjustments that can impact your tax liabilities and financial future. Below, we look at a few ways to help you make the most of your allowances and exemptions that you may or may not be aware of.

Maximising Allowances and Exemptions

Each tax year provides a new opportunity to take full advantage of various tax-free allowances and exemptions. This includes, but is not limited to, the Personal Allowance, the annual ISA (Individual Savings Account) allowance, Life-time ISA (LISA), pension contributions and Capital Gains Tax allowances (CGT). Strategically planning how to use these allowances can significantly reduce your tax liability and boost your savings.

Pension Contributions

Pension contributions are a critical consideration, particularly with the generous tax relief available. Contributions up to £60,000 annually (or 100% of your earnings, whichever is lower) can receive tax relief at your highest rate of tax. Making contributions at the start of the tax year can also maximise investment growth. It’s important to review your contributions annually to ensure you’re optimising for tax relief and adjusting for any changes in income.

ISA Investments

ISAs offer a tax-efficient way to save and invest, with no tax on interest, dividends, or capital gains. The annual ISA allowance (£20,000 for the 2023/2024 tax year) resets with each tax year, and unused allowances cannot be carried over. Therefore, considering your ISA contributions early in the tax year can maximise the potential for tax-free growth.

Maximising Your Financial Opportunities for the Upcoming Tax Year End_img-2_Right-Wealth-Management-2024

Lifetime ISA

Lifetime ISA (LISA) is a versatile savings method that can help maximise your financial opportunities as the tax year draws to a close. Designed for individuals aged 18 to 39, LISAs offer a unique blend of flexibility and government incentives, making them an attractive option for long-term savings goals, such as purchasing a first home or saving for retirement. If you pay in the maximum of £4,000 this tax year, the government will give you a bonus worth £1,000. By incorporating LISAs into your end-of-tax-year planning, you can significantly enhance your savings potential and financial security for the future.

Capital Gains Tax (CGT) Planning

If you dispose of assets such as selling a property or shares, considering the timing can be advantageous for CGT purposes. Each tax year offers an annual exemption amount, currently £6,000 for the 2023/2024 tax year, which are not taxed. This is reducing to £3,000 from 6th April 2024.

Inheritance Tax (IHT) Planning

The tax year also plays a role in IHT planning, with opportunities to make gifts that can reduce the future IHT liability. Understanding the annual exemptions and allowances for gifts can enable strategic gifting that falls out of your estate for IHT purposes after seven years.

Staying Updated on Changes

Tax laws, allowances, and rates can change with each budget announcement. Staying informed on these changes is key to adapting your financial planning.

Getting to know the tax year calendar, making the most of your tax breaks and benefits, and planning your finances smartly can really help you get your taxes in shape, grow your savings, and make your financial future a lot brighter. Remember, while it’s possible to do this yourself, seeking advice from a financial advisor can provide tailored strategies that align with your personal circumstances and goals.

Speak with our experts

At Right Wealth Management, our experts are here to guide you on how to best use your tax allowances, save on capital gains tax, make smart pension contributions, and invest wisely in ISAs. We’ll make sure you’re following all the tax rules and squeezing the most out of your savings and investments. If there are any great opportunities you’re missing or mistakes that could cost you, we’ll point them out. With our advice and guidance, you can make your own informed decisions that enhance your financial security and growth, freeing you to focus on your personal and professional aspirations with confidence.

Hurry before it’s too late! Book a discovery meeting with us today to find out more.

Important information: This information isn’t personal advice. If you’re not sure what’s best for your situation, you should seek financial advice from an expert.

How can we help?

Get in touch with our team to find out how we can provide you with financial peace of mind.