ARE YOU READY FOR THE NEW TAX YEAR?

It’s always a good idea to make the most of your annual tax allowances - but this year, it’s even more important.

Following Chancellor Jeremy Hunt’s last statement about his plans for the country’s finances, it seems there are reductions for various tax allowances planned in 2023/24.

So if you have savings sat in your current account, here are a few ways you could make them work harder for you before the end of the tax year on April 5th.

Top up your ISAs

If you have an ISA, check you’ve used all of your taxfree saving allowance. At the moment this stands at £20,000 per person for the tax year 2022/23. It’s a simple way to reduce your tax, and can be shared across both cash ISAs and stocks and shares ISAs.

Put more in your pension

You could receive tax relief by contributing to a pension – the annual allowance is up to £40,000, dependent on your income. It’s possible to carry forward unused allowances from the past three years as well, so well worth checking you’re utilising this.

Save for your children

For those with children, consider opening a Junior ISA (JISA). The annual allowance for a JISA this tax year is £9,000 and, as with an adult ISA, any gains on money made are free of UK income tax and capital gains tax.

Use your capital gains tax allowance

If you’re planning to sell any of your assets, now could be the time to do so. Currently the annual allowance for capital gains tax stands at £12,300 in 2022/23, but this is set to reduce to £6,000 next tax year, and £3,000 the tax year after.

Reduce your inheritance tax (IHT) bill

Think about making financial gifts to family and friends. Each year there is a £3,000 annual exemption allowance which can be used to help reduce your IHT. Check other exemptions, such as tax-free wedding gifts of up to £5,000 to your children, too.

For expert advice on your tax allowances, call Belgrave Wincham on 01691 886554.