Last Chance to Consider Tax Planning Options
In just over a month’s time, 5 April 2020, the 2019-20 tax year expires. After this date many of the options to utilise allowances and claim reliefs to reduce tax for 2019-20 will disappear.
A number of the reliefs to consider are listed below. This is by no means an exhaustive list. Any numbers quoted refer to the tax year 2019-20.
Have you utilised your £12,000 tax-free allowance for Capital Gains Tax purposes?
- You are entitled to make a number of small gifts that will not be taxed under the Inheritance Tax rules.
- Have you reviewed your pension contributions for 2019-20? According to the pundits, higher rate tax relief may be reduced in the budget next week. In which case, 2019-20 may be the last year to claim those higher rate reliefs.
- If you and your married partner are basic rate tax payers and one of you has not earned enough to cover their basic Income Tax personal allowance – £12,500 for 2019-20 – it may be possible to transfer part of the unused allowance to their partner. Check out the Marriage Allowance.
- Do you have an opportunity to draw up to £2,000 tax-free from your company in dividends? No additional tax to pay. Only applies to the first £2,000 in dividends you take.
The above list does not include other strategies for business owners and many more complex options for high income earners.