Springtime Tax Planning – Don’t Delay By Peter Pearson Independent Financial Adviser, Tenet&You
With spring just about in reach, the earth is full of promise as early bulbs peak through, and we look forward to brighter skies; why not take the opportunity to get proactive and knuckle down on your finances?
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ith the end of the tax year (5 April) also in sight, this is the ideal time to double check you’ve taken full advantage of all your annual allowances. So, to help you on your way, here is a handy reminder of some of your main tax planning opportunities: 96
Individual Savings Accounts (ISAs) – maximum annual contribution of £20,000 per adult. Junior Individual Savings Accounts (JISAs) – maximum annual contribution of £9,000 per child. Pensions – current Annual Allowance of £40,000. For every £2 of adjusted income over £240,000, an individual’s Annual Allowance is reduced by £1 (the minimum Annual Allowance is £4,000). The Lifetime Allowance places a limit on the amount you can hold across all your pension funds without having to pay extra tax when you withdraw money, the limit is
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currently £1,073,100. And don’t forget your children’s pension; the maximum annual pension contribution you can currently make is £2,880 which, along with tax relief, amounts to £3,600 a year. Making Inheritance Tax-free gifts – each financial year you can make gifts of up to £3,000 (in total, not per recipient) and if you don’t use this in one tax year, you can carry over any leftover allowance to the next year (some other exempted/small gifts allowable). To reduce the amount of IHT payable, many families consider giving their assets away during their lifetime. These are called ‘potentially www.lancmag.com
