Points to consider

Personal Tax:

  • Pensions: Have you used the carry forward rules in order to benefit from any unused allowances from the previous three tax years? This is generally the difference between £40,000 and the pension input each year.
  • Charitable donations: If you are a higher rate taxpayer make sure that these are under Gift Aid so that you obtain additional tax relief. The charity will also be able to reclaim the basic rate tax from HMRC. Note also that Gift Aid payments can be carried back for relief in the previous tax year.
  • Reduction in personal allowance: For every £2 that adjusted income exceeds £100,000, the £10,000 personal allowance is reduced by a £1. Pension contributions and Gift Aid can help reduce adjusted net income and save tax at an effective rate of 60%
  • ISAs: Have you used your maximum annual investment of £20,000 for 2017/18?
  • Junior ISAS and pensions: Have you thought of investing for your children or grandchildren by setting up a Junior ISAs or pensions? in the 2017/18 tax year, you can invest £4,128 into a Junior ISA for any child under 18 who does not have Child Trust Fund.
  • Capital gains: Have you used your 2017/18 annual exemption of £11,300? Consider selling shares where the gain is less than £11,300 before 6 April 2018. If you have worthless shares consider a negligible value claim to establish the capital loss. You may even be set off against your income.
  • Enterprise Investment Scheme (EIS) Investments: If you are looking for investment opportunities, have you considered EIS, which offers income tax relief of 30 per cent as well as capital gains tax relief?
  • Seed EIS investments (SEIS): These investments offer income tax relief of 50 per cent and a capital gains tax exemption on disposal. There is also a capital gains tax reinvestment relief on 50 per cent of a capital gains realised on the disposal of any assets during the 2017/18 when it is reinvested into a SEIS qualifying company.
  • Venture capital trust investments: these investments also provide income tax relief of 30 per cent, as well as tax free dividends.
  • Inheritance tax (IHT): Have you made use of your annual exemptions? The general annual exemption is £3,000 (plus last year's £3,000 exemption if you did not use it.) Also consider making regular gifts out of your income to minimise the growth of your estate what will be liable to IHT.

Business Tax:

  • Capital allowances: Take advantage of the £200,000 Annual Investment Allowance (AIA) before your business year end to provide 100% tax write off for equipment.
  • Integral features: When buying business premises check out the value of fixtures and fittings in the building. Items such as electrical, water and heating systems qualify for capital allowances and would potentially qualify for £200,000 AIA mentioned above.

If you have any enquiries regarding tax planning please contact a member of the Private Client Team.