It seemed only a couple of weeks ago that I was frantically chasing clients for information so that I can meet the 31 January personal tax return deadline, and now after a brief snow filled pause the next tax yeasr is nearly upon us. There a few simple year end tax planning tips that I always mention to my clients which I’m going to summarise below –
1. If you operate through your own company, try and delay taking large dividend payments in March and take instead after 5th April. This will push back the date that you will have to pay income tax on those dividends by 12 months, so for example a £5,000 dividend taken on 31 March 18 will have a tax due date of 31 January 18 whereas one taken on 6th April will be 31 January 19.
2. Conversely if you are a sole trader or partner consider making lump sum payments into your personal pension before 5th April to bring forward the tax relief by 12 months.
3. Purchase any large capital items such as vehicles, equipment, machinery before your year end.
4. Make use of your capital gains annual exemption (£11,100) and ISA allowance (£15,240)
5. Think about transferring income generating assets to your spouse